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In Iraq, where barely anyone has a bank account, the trade in foreign currencies is largely unlicensed. Now money traders are smuggling US dollars to sanctioned Syria and Iran. And the Iraqi govt may well be using the situation for its own political ends too, according to this report from NIQASH.

The Iraqi dinar is at risk. That is the pronouncement made by Khadir Sadoun, who sits on the sidewalk in the upmarket Arasat neighbourhood in central Baghdad. But Sadoun didnt study business or economics, he probably doesnt even know about the sanctions on Iran and Syria that are causing the risks he is talking about. In fact, it is the market place has taught him all he knows.

And my business is flourishing, Sadoun adds, as he wraps a rubber band around a pile of currency. For the first time in years, Iraqis are exchanging their local dinars for US dollars in this way, the trader said, indicating the large piles of cash he was working with.

Over the past few weeks, the market exchange rate has seen the Iraqi dinar plummet against the US dollar. In part this is due to the current, increased demand for the US dollar. This is regional: international sanctions have been imposed on two of Iraqs neighbours, Iran and Syria, and, as local analyst, Basim Antoin, explained: over the past few months theres been an increase in currency smuggling and this has led to an increase in demand for the US dollar.

Both Syria and Iran are suffering from a severe economic crisis because of international sanctions imposed upon them, economic strategist and Iraqs former Minister of Planning, Mahdi Al-Hafez, said. This is why they are coming to the Iraqi market in search of hard currency.

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Iraq Business News is delighted to bring you the latest Iraq Market Tracker report from Dunia Frontier Consultants. The market tracker highlights the activities and market performance of a basket of publicly traded firms who derive a significant percentage of their revenues from operations in Iraq, but are traded on foreign exchanges: a proxy Iraq play as much as practicable. It also identifies and analyzes the primary political and security events that occur in country that have market-moving implications.

Click here to access the report.

Companies Mentioned:

BP, CNPC, Exxon, Genel Energy, Total

Action Calls:

• Iraqi Kurdistan to push ahead with oil exports: Gives KRG "plan B" for oil revenues and leverage in negotiations.
• Genel expands again in Kurdish Region: Shows resilience of Kurdish oil companies despite the ongoing standoff.

Headlines:

• Iraq summons Turkish Ambassador: Suddenly makes sense in the context of Kurdish pipeline announcement.
• Mutlak allowed to return to post: "Mercy" for Mutlak, doesn't guarantee same for Hashimi.

Calendar Events Discussed:

• May 23 - P5+1 Nuclear Talks in Baghdad
• May 30-31 - 4th Round Oil and Gas Auction
• June 15 - Parliament returns from 6 week break

Click here to access the report, or to add your email address to Dunia's mailing list to receive the Iraq Market Tracker via email.

Preparations are being made for a fourth auction of oil and natural gas exploration zones. This will be in line with the country's aim to rival Saudi Arabia as one of the world’s leading oil producers.

Iraq’s official statistics reveal that oil reserves are pegged at 143.1 billion barrels, the fourth largest in the world.  However the former oil minister who is now deputy prime minister Hussain al-Shahristani says the country has potential reserves of over 214 billion barrels.

Iraq’s Oil Ministry revealed that 12 new exploration zones will be auctioned off on Wednesday May 30^{th –} Thursday 31^st May 2012. All of the exploration zones are in remote areas which in turn makes them vulnerable to insurgent attacks.

The zones are mainly situated in Western and Central Iraq and companies who win the licenses will have to be able to commit to spending $90 million – 200 million.

Analysts state that Shahristani (Pictured) initially aimed to boost production to 10 million – 12 million bpd by 2017, this will not occur due to the underdeveloped infrastructure, the boost in production has been pushed back to 2020. “While the government’s most ambitious targets suggest 12 million – 13 million bpd by 2020 is theoretically possible, an output plateau of around 6 million – 7 million appears more likely” according to Oxford Analytica. Even this would earn the Iraqi Government $1 billion per day to fund on-going national reconstruction.

(Source: UPI)

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Iraq Business News is delighted to bring you the latest Iraq Market Tracker report from Dunia Frontier Consultants. The market tracker highlights the activities and market performance of a basket of publicly traded firms who derive a significant percentage of their revenues from operations in Iraq, but are traded on foreign exchanges: a proxy Iraq play as much as practicable. It also identifies and analyzes the primary political and security events that occur in country that have market-moving implications.

Click here to access the report.

Companies Mentioned:

DNO, ExxonMobil, Shell

Action Calls:

• Moves afoot as Maliki pushes back on rivals: Maliki shows once again why he maintains his position on top of Iraqi politics.
• Shell negotiates cut to Majnoon output target: As we expected, Exxon is not the only one to benefit from their Kurdish PSC move.
• DNO lifts reserve estimates: DNO's adjustment - opportunity to revisit our Kurdish oil thesis.

Headlines:

• Move towards police supremacy continuing: One small potential step towards normalization of Iraq.
• Sadrist PDB asserting self in Basra: Potentially an indicator of SoL-Sadrist relations.

Calendar Events Discussed:

• May 23 - P5+1 Nuclear Talks in Baghdad
• May 30-31 - 4th Round Oil and Gas Auction
• June 15 - Parliament returns from 6 week break

Click here to access the report, or to add your email address to Dunia's mailing list to receive the Iraq Market Tracker via email.

Advertising Feature

Iraq Business News is delighted to bring you the latest Iraq Market Tracker report from Dunia Frontier Consultants. The market tracker highlights the activities and market performance of a basket of publicly traded firms who derive a significant percentage of their revenues from operations in Iraq, but are traded on foreign exchanges: a proxy Iraq play as much as practicable. It also identifies and analyzes the primary political and security events that occur in country that have market-moving implications.

Click here to access the report.

Companies Mentioned:

ExxonMobil, Total

Action Calls:

• Sadr threatens no-confidence within 15 days:Not likely to result in no confidence, but may result in movement on some issues.
• Exxon signs contract to drill 20 wells with IDC: Signals Exxon's commitment to West Qurna 1, and tacit support at Ministry of Oil.
• Our take on 4th Round contracts: Auction will only be first test for viability of exploration under fixed payments.

Headlines:

• Qubad Talabani to return to Erbil: Most likely succession planning and sign of unity, but also signal to Baghdad?
• Tensions with Sadr in Baghdad, Basra: Look to Maliki's relations with Sadrists as signal of how far he's willing to push.

Calendar Events Discussed:

• May 23 - P5+1 Nuclear Talks in Baghdad
• May 30-31 - 4th Round Oil and Gas Auction

Click here to access the report, or to add your email address to Dunia's mailing list to receive the Iraq Market Tracker via email.

Advertising Feature

Iraq Business News is delighted to bring you the latest Iraq Market Tracker report from Dunia Frontier Consultants. The market tracker highlights the activities and market performance of a basket of publicly traded firms who derive a significant percentage of their revenues from operations in Iraq, but are traded on foreign exchanges: a proxy Iraq play as much as practicable. It also identifies and analyzes the primary political and security events that occur in country that have market-moving implications.

Click here to access the report.

Companies Mentioned:

ExxonMobil, WesternZagros

Action Calls:

• Sadr in Erbil to mediate on crisis : Sadr won't resolve stalemate. Watch Baghdad and Erbil for signs.
• WesternZagros discovers new oil field, shares rise 20%: Hopefully those who may have sold into strength were able to get back in.

Headlines:

• NA Still Supports Maliki...With Conditions: Reminder of limits of Maliki's power.
• Second SPM exports two million barrels in first shipment: Kurdish oil becomes less relevant, though not totally irrelevant.

Calendar Events Discussed:

• May 23 - P5+1 Nuclear Talks in Baghdad
• May 30-31 - 4th Round Oil and Gas Auction

Click here to access the report, or to add your email address to Dunia's mailing list to receive the Iraq Market Tracker via email.

Advertising Feature

Iraq Business News is delighted to bring you the latest Iraq Market Tracker report from Dunia Frontier Consultants. The market tracker highlights the activities and market performance of a basket of publicly traded firms who derive a significant percentage of their revenues from operations in Iraq, but are traded on foreign exchanges: a proxy Iraq play as much as practicable. It also identifies and analyzes the primary political and security events that occur in country that have market-moving implications.

Click here to access the report.

Companies Mentioned:

Afren, DNO, Exxon, Gulf Keystone, Genel Energy, Heritage Oil, WesternZagros

Action Calls:

• Escalation in rhetoric against Maliki: Maliki apparently overreaches with IHEC arrests as Sadr joins protests.
• Afren shares up on Kurdistan oil discovery: Afren joins list of oil firms with Kurdish discoveries.

Headlines:

• Exxon excluded from 4th round as auction terms revealed: Exxon exclusion not surprising. Bigger news is lack of significant concessions to bidders.
• Second SPM Comes Online: Puts Kurdish threats to cut off exports in perspective.
• AQI Claims Thursday Attacks: Lull broken, but larger trend is towards decreased violence.

Calendar Events Discussed:

• May 30-31 - 4th Round Oil and Gas Auction

Click here to access the report, or to add your email address to Dunia's mailing list to receive the Iraq Market Tracker via email.

Exxon Mobil is conspicuously absent from the finalized list of 47 pre-qualified bidders for the Iraq's fourth round of energy exploration rights.

The Petroleum Contracts and Licensing Directorate (PCLD) at the Ministry of Oil has confirmed that the auction will take place as scheduled on May 30-31.

The full list of pre-qualified companies is shown below:

Iraq's deputy oil minister, Ahmed al-Shamma, said that Iraq still hopes to award a contract for the development of the 4.4 billion barrel Nassiriya oil field and the construction of a dedicated 300,000 bpd export refinery as one package.

Iraq excluded Nassiriya from its three previous bidding rounds for oil and gas licences.

According to Platts, Baghdad had been in drawn-out negotiations with a consortium led by Japan's Nippon Oil to develop the field, but the ministry eventually assigned management of the field to the state-run South Oil Company.

Shamma said Iraq has also already prepared infrastructure at the southern port of Fao [Faw] needed for product exports from a refinery at Nassiriya. "We don't want to develop the Nassiriya field and then send crude to Basra as it will put an extra burden on our export facilities [in the south]. We already have enough oil in Basra," he said.

"We prefer oil to go to the refinery; this will provide the investor with a better deal."

"We have coordinated the building of four new dedicated jetties at Fao for products -- for gasoil, gasoline, jet fuel and fuel oil," Shamma said. In September last year, Iraq said it would hold an auction for rights to develop Nassiriya if the three companies pre-qualified to bid are interested and the oil ministry decides to turn the project over to foreign companies.

Nippon Oil, Spain's Repsol, Italy's Eni, and US firm Chevron have all submitted proposals to develop the field. Repsol was later disqualified for signing contracts which Baghdad considers illegal with the Kurdistan Regional Government.

(Source: Platts)

Advertising Feature

Iraq Business News is delighted to bring you the latest Iraq Market Tracker report from Dunia Frontier Consultants. The market tracker highlights the activities and market performance of a basket of publicly traded firms who derive a significant percentage of their revenues from operations in Iraq, but are traded on foreign exchanges: a proxy Iraq play as much as practicable. It also identifies and analyzes the primary political and security events that occur in country that have market-moving implications.

Click here to access the report.

Companies Mentioned:

DNO International, Exxon, Genel Energy, Gulf Keystone, Shell, Total, WesternZagros

Action Calls:

• Baghdad and Erbil step back from precipice: Moderation has returned, hopefully signalling negotiations are back on track.
• DNO says production hurt in Iraq: Volatility on Erbil-Baghdad has a direct impact on Kurdish oil shares.
• Iraq signs MoU with Shell for huge petrochemical plant: Baghdad's favorite foil to Exxon gets rewarded.

Headlines:

• Rumored move to Erbil for Talabani: Good for Kurdish unity, good for negotiating with Baghdad.
• Less than 6 Hours of Power this summer in Dhi Qar: Sadr will have look elsewhere to criticize, since his man is PC President in Dhi Qar.

Calendar Events Discussed:

• April 20 - Rewritten contract terms expected for 4th Oil and Gas Auction

Click here to access the report, or to add your email address to Dunia's mailing list to receive the Iraq Market Tracker via email.