Iraq's Dynamic Evolving Energy Landscape in 2024, A Comprehensive Overview

Iraq's Dynamic Evolving Energy Landscape in 2024, A Comprehensive Overview

Published about 2 months ago at 04 June 2024

Iraq, a pivotal player in the global energy market, stands as the second-largest crude oil producer in OPEC, following Saudi Arabia, and the sixth-largest producer of total petroleum liquids worldwide. With the fifth-largest proved crude oil reserves globally, Iraq holds a significant position in the energy sector, underpinned by its extensive onshore oil fields, primarily in the Basra, Diyala, and Kirkuk regions.

Crude Oil Production and Exports

Crude oil exports are the linchpin of Iraq's economy, accounting for about 95% of its government revenue in 2022. Iraq's oil revenues surged to $131 billion in 2022, driven by elevated oil prices and increased production. However, 2023 witnessed a dip in oil revenues due to global price reductions and OPEC+ production cuts. Despite these challenges, Iraq aims to boost its crude oil production capacity to 7 million barrels per day (b/d) by 2027, supported by several upstream projects, albeit hampered by political and regulatory hurdles.

Kurdistan Regional Government (KRG) and Federal Iraq

The relationship between the Kurdistan Regional Government (KRG) and Federal Iraq remains complex, marked by disputes over sovereignty and oil production. The KRG's oil production has faced setbacks due to delayed payments to international oil companies (IOCs) and underwhelming exploration results. The closure of the Iraq-to-Turkey pipeline in 2023 further strained KRG's production capacity, impacting the region's economic stability and increasing its reliance on loans from Federal Iraq.

Natural Gas Sector

Iraq's natural gas sector, while promising, is constrained by regulatory and investment challenges. With the 12th largest proved natural gas reserves globally, Iraq's natural gas output has remained relatively flat due to insufficient infrastructure. In 2022, Iraq was the second-largest source of flared natural gas worldwide, a consequence of inadequate pipeline capacity. Projects aimed at capturing associated natural gas are in the pipeline, potentially boosting electricity generation and reducing reliance on imports from Iran.

Refining Capacity and Future Projects

Iraq's refining sector is undergoing significant changes, with a current operating capacity of about 1.2 million b/d. The country aims to reduce its dependency on imported petroleum products by expanding and upgrading existing refineries and commissioning new ones. Notable projects include the Karbala refinery, which reached full capacity in September 2023, and upcoming projects at the Basra and Baiji refineries slated for completion in 2024.

Investment and Infrastructure Challenges

The ambitious plans to enhance Iraq's energy production are frequently hindered by political instability, regulatory challenges, and bureaucratic delays. Despite these obstacles, international partnerships, such as the agreement with TotalEnergies for a seawater conversion project, highlight Iraq's potential to overcome these challenges and boost its energy output in the coming years.


Iraq's energy landscape in 2024 is characterized by significant potential tempered by substantial challenges. The nation's reliance on crude oil revenues, coupled with the need for improved infrastructure and regulatory reform, will shape its energy strategy moving forward. As Iraq navigates these complexities, its role in the global energy market remains crucial, with ongoing efforts to harness its vast natural resources and attract foreign investment.

The information for this summary was derived from the U.S. Energy Information Administration's "Country Analysis Brief: Iraq" published in February 2024.


  • U.S. Energy Information Administration (EIA), Country Analysis Brief: Iraq, February 2024.