Iraq’s oil may not be all that it seems. Since December three buyers, including two state buyers in China, have complained about the high water content that could mean more upgrading work is needed on Iraq’s oil infrastructure or that it needs to slow down loading schedules again. “Production is indeed higher, but the time needed for base sediment and water to settle down is not enough. They are just shifting their problem to us” according to one buyer.
The water content has been about 1% compared with the 0.1% that refiners can accept. The buyers have sought compensation but received nothing as yet. The water issue emerged just before Iraq’s volumes started hitting new peaks.