Iraq piles pressure on OPEC over quota dispute after UAE exit

An Iraqi worker adjusts a control valve at the Daura oil refinery in Baghdad, Iraq. Iraq and a grouping of U.S and European oil companies Exxon Mobil Corp and Royal Dutch Shell PLC signed a $50 billion contract to develop the West Qurna oilfield, which comes after the Iraqi South Oil Company signed a technical service contract with Britain's BP and China's CNPC to develop the Rumaila oilfield.

Muhannad Fala'ah | Getty Images News | Getty Images

Iraq wants OPEC to significantly increase the country's oil supply quota, Baghdad said on Thursday, following reports it would consider quitting the cartel over the dispute.

As the second-largest oil exporter in the group, Iraq holds significant influence over OPEC, which saw its third-largest producer, the United Arab Emirates, exit in April.

It comes after Reuters reported Iraq was weighing leaving the cartel and Bloomberg quoted an Iraqi old ministry spokesperson warning that a "decision will have to be made regarding whether to remain in or withdraw" if oil quotas are not lifted.

Iraq's oil ministry said later on Thursday that reports suggesting Baghdad could end its membership in OPEC "did not reflect the Iraqi government's official position," but added that it continues to stress the importance of reviewing oil production quotas.

Neither the Iraqi ministry and OPEC were immediately available to respond directly to comment requests from CNBC.

Iraq's economy is heavily reliant on oil, and its dependency on exports through the Persian Gulf has been exposed since the U.S. and Israel began war with Iran on February 28.

The Iraqi cabinet in June approved plans to accelerate crude exports through the Kurdistan-Turkey pipeline network, which would more than triple its existing shipments from 220,000 barrels per day to 770,000.

The route offers an alternative passage through Kurdistan to Turkey's Mediterranean port of Ceyhan. When operating at full capacity, it should provide relief to the oil-dependent Iraqi economy, which contributed 53% to its real GDP in 2025, according to the World Bank.

Exclusive data shown to CNBC by economic intelligence provider QuantCube Technology reveals that Iraq's overall exports have virtually dried up since the war began, as a result of its geographical dependence on Hormuz.

QuantCube's indicator measures the volume of deadweight tonnage leaving Iraqi and UAE ports, which provides an estimate of the cargo weight the ships are carrying.