Iraqi Prime Minister Haider Al Abadi on Sunday unveiled an ambitious plan to end its dependence on oil through building up its private sector over the course of just five years.
The plans are reminiscent of Iraq's earlier plans to shift away from oil and towards the industrial sector, which were discussed in mid-2013. At the time, the plan faced many headwinds, including political discord and disruptive sectarian violence.
"The government made a decision to focus on other sources in the country instead of oil, so the new plan will basically focus on industry instead of oil," said Hussain al-Shahristani deputy prime minister for energy affairs, said at the time.
Today, 90 percent of Iraq's total revenue comes from the oil sector.
This time around, the plan is to shift away from oil and toward agriculture-a move that if successful, would insulate Iraq from significant swings in oil prices, not to mention lessen the burden of its tether to OPEC's oil production cuts.
At the same time, Iraq approved over the weekend an increase to its oil production capacity by as much as 1.5 million barrels per day, despite its duty to OPEC to curb production to 4.35 million bpd. The plans to increase Iraq's oil production capacity comes just days after Oil Minister Jabbar al-Luiebi recently told media that Iraq's proven crude oil reserves could be much higher than previously estimated.
If the higher estimate proves true, it would make Iraq the largest oil-rich country in the world, ahead of Venezuela, which claims its reserves are just above 300 billion barrels, and also ahead of Saudi Arabia, with 260.8 billion barrels.
Al-Luaibi's remarks on the reserve estimates come amid preparations for the next oil tender in the country, which is to take place this week and offer 11 exploration blocks to foreign companies.
By Julianne Geiger for Oilprice.com
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Julianne Geiger is a veteran editor, writer and researcher for Oilprice.com, and a member of the Creative Professionals Networking Group. More