May 21, 2007

Between May 2006 and the end of April 2007 the ministry exported 560 million barrels of oil, earning about $31 billion, up from 505 million barrels worth $25.6 billion during the previous 12 months.

"We are still exporting from Basra port about 1.6 million barrels a day and this means production is at the highest levels," Shahristani said at a press conference.

"Because of the sabotage and terror acts, the oil pipelines are constantly being attacked. Therefore, we cannot maintain production through the northern pipeline into [Turkey's] Ceyhan port," he said.

If the northern pipe was open, daily exports would rise to 2 million barrels, he added.

But the spiraling chaos in the country continues to paralyze its most crucial industry. In the last 12 months, 198 ministry employees were killed in over 200 attacks on Iraq's oil infrastructure.

Shahristani ascribed the current fuel shortages in Baghdad to attacks on the bridges south of the city that have made it difficult to transport fuel there.

Despite immense reserves, which a recent report suggests are actually twice as large as current estimates of 116 billion barrels, persistent sabotage and corruption have prevented the sector from realizing its potential.

Between $5 million and $15 million worth of oil a day is unaccounted for in Iraq and could have been siphoned off through corruption or smuggling, The New York Times reported earlier this month.

Citing a draft of a US government report, the newspaper said the country has lost between 100,000 and 300,000 barrels a day of its declared oil production over the past four years.

The Financial Times cited a report Thursday by the IHS consultancy estimating Iraq's oil reserves to be twice as large as currently believed.

The report also said that with more international investment Iraq could double its current rate of production in five years to 4 million barrels of oil a day.

If the report is accurate, Iraq would have the second-largest reserves in the world after Saudi Arabia.

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