Al Majal Updates


Al Majal continues its participation as a silver sponsor of Iraq Business Forum’s (IBF) latest online event, which took place on November 4th. Al Majal has been a regular sponsor of IBF, the premier, exclusive business event in Dubai for companies and international investors focused on Iraq.



In light of the improved political situation and oil output exceeding 1 million barrels in Libya, Al Majal has resumed its operations in the Libyan market with a focus on specialized oil and gas products and services.
The company operates in the territory under its subsidiary “FES Libya” which is a joint venture company between Al Majal and Medserv, a Malta-based publicly listed company that operates as an integrated logistics shore base and engineering service provider for oil and gas projects across a number of Mediterranean countries. FES Libya is present in Tripoli and the Malta Free zone.


Qamar Energy’s Monthly Contribution


Latest in the Iraqi & Regional Energy Markets



Daily coronavirus cases continue climbing in Iraq, but at a much slower pace than in September, when the country recorded a peak of 5,505 daily cases. Daily deaths have reduced by ~55% from a high of 122 in June, with overall recovery surpassing 87%, a marked improvement from rates recorded in Q3, even though it remains among the lower ones in the region. Economic revival is hinging on the country’s energy sector, where several high-profile developments have taken place in recent weeks, including a surge in crude production and exports. However, a ballooning government deficit (reportedly US$ 67.7 B for Q4 2020), which resulted in the approval of a 96-page economic reform white paper by Prime Minister Kadhimi, has raised concerns over how quickly energy plans could be realized. Iraq’s 2020 GDP is forecast to contract by 12.1%, with a minor increase of 2.1% in 2021, but this depends on the state of the budget. This adds to concern that Iraq may have to devalue the dinar, indicatively by about 20% against the dollar, to raise the value of its oil revenues in local currency terms. However, this would likely increase inflation and lead to demands for cost-of-living increases to salaries, and harm contractors awaiting payment denominated in dinars. A roundup of the latest developments in the Iraqi energy markets is summarized in the table below.



Bearish market sentiment is expected to continue weighing on world oil demand outlook for the remainder of the year and into the first quarter of the New Year. Key contributors to the less-than-positive demand outlook are continued concerns surrounding the return of road and transportation fuel demand in OECD Americas with severe surges of the pandemic in the USA, and poor road and aviation-fuel sales in OECD Asia. Buying has also slowed down in China, even through traffic data has steadily normalized to pre-crisis levels.
In the Middle East, overall demand is expected to contract by 380 kb/d in Q4 2020 from Q3 levels, even though consumption had surged by near 970 kb/d in the third quarter, compared to Q2 levels of 6.91 Mb/d. Seasonality is expected to play a large part in demand reduction as the weather turns cooler, as well as the continuation of social distancing measures, work and school from home, and mobility restrictions. PMIs have stabilized, even though economic activity remains slow, reflected in lower diesel consumption. This has informed some noteworthy deals in the energy sector in recent weeks, summarized in the following table.



Top Energy Deals in the Region



Regional Rig Count (1): OPEC+ Pressure to Keep Iraq Rig Count Low



Source: Baker Hughes International Rig Count
Note: Iraqi gas rigs are not reported by Baker Hughes, likely because Iraq reports gas rig figures clubbed with oil rigs and/or lack of response from contractors.
* End of Qamar Energy’s contribution, for more information about Qamar Energy, please visit www.qamarenergy.com


Iraq Oil Market Highlights



Iraq Coronavirus Cases Overview
Since the Beginning of the Outbreak


Iraq Oil & Gas News


China’s oil giants China National Petroleum Corporation and CNOOC Ltd. might be considering acquiring Exxon Mobil Corporation’s remaining stake in an oil field in Iraq.



The Prime Minister of Iraq, Mustafa Al-Kadhimi, and the Iraqi Oil Minister, Ihsan Abdul Jabbar Ismail, received a delegation from Lukoil, headed by its President Vagit Alekperov. The meeting was also attended by the Russian Ambassador Maxim Maximov.



Iraq’s Ministry of Oil has announced initial oil exports for October of 89 million barrels, giving an average for the month of 2.9 million barrels per day (bpd), up from the 2.6 million bpd exported in September.


Iraq Security Updates


One Casualty and Five Civilians Wounded in Rocket Attack on Baghdad’s Green Zone

Seven rockets reportedly struck Baghdad’s fortified Green Zone in mid-November with the city’s US embassy thought to be the target. Four of the rockets landed inside the Green Zone where key government offices and western diplomatic missions are located, according to Iraqi officials. One of the rockets hit Baghdad’s Medical City, another landed near Zawra Park and the last was intercepted, the government said. It was reported that the attacks resulted in one casualty and five civilians were also wounded.


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