Iraq has indicated that it might consider withdrawing from OPEC if the organization does not grant it a higher oil production quota. This comes just months after the United Arab Emirates exited the group to increase its own production. While the Iraqi Oil Ministry currently states no intention to withdraw, spokesman Salim Al-Rikabi emphasized that if their request for a higher quota, aligned with their increased production capabilities, is not met, a decision regarding their continued membership will be necessary.
Sources familiar with Iraqi oil policy reiterated that Iraq would consider all options if its OPEC quota is not significantly increased, having already weighed leaving the producer group. This potential departure would be a significant blow to OPEC, as Iraq is its second-largest producer and one of its five founding members. A senior Iraqi oil ministry official stressed that Saudi Arabia and other OPEC allies should take Iraq's financial crisis, exacerbated by the Iran war, seriously and consider a substantial increase in its quota.
Prime Minister Ali al-Zaidi has stated that Iraq wants OPEC to raise its oil output in line with its production capacity and population. Iraq aims to restore its full oil export capacity and increase oil production to 7 million barrels per day in the coming years. The country's economy is highly dependent on oil revenue, with petroleum sales accounting for 90% of the state budget, and it has been severely impacted by disruptions to the Strait of Hormuz, which have locked in a significant portion of its exports.
Oil prices briefly dipped below $73 a barrel following these reports. The potential withdrawal of Iraq would follow the UAE's departure on May 1, 2026, after years of disputes over output quotas. Seven core members of the OPEC+ group, which includes OPEC and allied producers like Russia, have already increased their output quotas by almost 600,000 barrels per day from April to June.
