Iraq remains above OPEC+ target as Kurdistan oil output stabilises

A rise in output from the Kurdistan Region of Iraq over the last year is increasing the pressure on Iraq to meet its OPEC+ production cut target. Iraq has consistently exceeded its production quota and despite agreeing to compensation mechanisms to offset the overproduction, recent output has remained above the target. Iraq has reiterated its steps to compensate for overproduction and outlined plans to reduce output going forward. This includes Federal Iraq putting pressure on Kurdistan to reduce supply. Ongoing overproduction by individual countries will face additional scrutiny from the OPEC+ group, particularly if the market weakens and the unwinding of the voluntary production cuts is delayed. Iraq will face increasing pressure to adhere to its target and compensate for previously over-produced volumes.