Economist: Joining BRICS is one of the solutions to diversify sources of hard currency
Economic affairs researcher Hisham Al-Baydani explained that Iraq’s accession to BRICS is one of the solutions to diversify the sources of foreign currency within the country and be freed from American restrictions imposed, especially on the dollar.
Al-Baydani told Al-Maalouma, “Iraq must be freed from the restrictions imposed by Washington on its sources of foreign currency, especially after the hints and statements of the American ambassador in Baghdad regarding more restrictions on the movement of the dollar.”
He added, “The American restrictions imposed on Baghdad caused exchange rates to fluctuate, which affected citizens’ transactions in general, especially since there is demand for foreign currency in the local market.”
He stated that “joining BRICS may be one of the solutions that could be a way out for Iraq, which is rich in oil resources, but is governed economically by a foreign financial policy imposed by the American administration on the Iraqi monetary authority.” link
Suspension of official working hours next Tuesday
Economy News – Baghdad
Prime Minister Mohamed Shia al-Sudani ordered the suspension of official working hours next Tuesday.
The General Secretariat of the Council of Ministers stated in a brief statement that “Prime Minister Muhammad Shia Al-Sudani directed the suspension of official working hours on Tuesday, 2023/10/3, in all ministries and state institutions, in celebration of the National Day of the Republic of Iraq
Globally.. Oil Approaching $100 A Barrel
Oil prices continue to rise in early Asian trading on Thursday, after climbing to a 2023 high in the previous session, as fears of tight global supplies were exacerbated by a sharp drop in U.S. crude inventories that reached critical levels.
Government data showed that U.S. crude oil inventories fell last week by about 2.2 million barrels, to 416.3 million barrels. The decline far exceeded analysts’ expectations, in a Reuters poll, with a decline of almost 320,<> barrels.
This followed voluntary production cuts of 1.3 million bpd until the end of the year from Saudi Arabia and Russia.
Brent crude continues to approach levels of $ 100 a barrel as it trades in magnified trading in Asia on Thursday above the levels of $ 97, an increase of 0.9 percent, the highest level since last November.
U.S. West Texas Intermediate crude futures rose more than a dollar to $94.70, the highest level since August 2022, and U.S. crude jumped 3.6 percent at settlement on Wednesday, its biggest gain since early May.
Inventories in Cushing, Oklahoma, the delivery point for U.S. crude, fell to just under 22 million barrels, the lowest level since July 2022 and close to the operating minimum.
Strong Dollar Fails to Rein in Oil
Amrita Sen, co-founder and head of research at Energy Aspects, said: “What I fear in this market is that we have made huge inventory reductions. Right now, what’s happening in the U.S. – (drought of inventories in Cushing),” according to Bloomberg.
Advisor to the Prime Minister: Speeding up the approval of the oil and gas law will establish two important things
The financial adviser to the Prime Minister, Mazhar Mohammed Saleh, stressed the importance of speeding up the approval of the draft oil and gas law.
Saleh said in a press statement that “accelerating the approval of the federal oil and gas project law in the House of Representatives as soon as possible will establish a stable national roadmap for investment and production of the country’s main sovereign resource, which is oil and gas.”
He explained that “this natural resource contributes to Iraq’s GDP by a direct rate of nearly 50 percent, and leaves an indirect impact on the total economic activity of our country by at least 85 percent.”
“The adoption of a unified national oil policy, and the achievement of investment and optimal production on Iraq’s oil area, starting from the southern fields up to the fields of the north and the region, is an important and strategic matter in the matter of benefiting from the opportunity costs in the optimal and homogeneous operation of the Iraqi oil policy currently,” Saleh said.
Not to mention “achieving the best financial returns for the country, which we all look forward to to finance the building of the Iraqi economy and the basics of sustainable development,” according to Saleh.
Iraq’s draft oil and gas law, which is available to parliament, stipulates that responsibility for managing the country’s oil fields should be vested in a national oil company and supervised by a specialized federal council.
For its part, the Kurdistan Petroleum Law states that the Iraqi government “has the right to participate in the management of the fields discovered before 2005, but the fields discovered after it belong to the regional government.”
The committee, which was formed between Baghdad and Kurdistan to draft an oil and gas law, includes “the minister of oil, the minister of natural resources in the region, the director general of SOMO and the advanced staff in the Ministry of Oil, as well as oil-producing provinces such as Basra, Dhi Qar, Maysan and Kirkuk.”
Prime Minister Mohammed Shia al-Sudani said in early August that “the draft oil and gas law is one of the basic and important laws, representing a factor of strength and unity for Iraq, and it has been stuck for years, at a time when the country today is in dire need of its legislation and benefit from this natural wealth, in all fields and sectors, as well as the contribution of the legislation of the law in solving many outstanding problems.”
“There are provinces that have not invested their wealth until today, which is a negative matter for development efforts in all its tracks,” he said.
The oil dispute has been a major source of tension between Baghdad and Erbil for years, reaching the judiciary last year, as Erbil believed that the central government was seeking to seize the region’s wealth.
In February 2022, the Federal Court in Baghdad ordered the region to deliver oil produced on its territory to Baghdad, and canceled contracts signed by the region with foreign companies.
It went so far as to invalidate the judiciary in Baghdad for contracts with numerous foreign companies, particularly American and Canadian.
After years of exporting oil individually through Turkey, the Kurdistan region, as of late March 2023, had an international arbitration tribunal decision that gave Baghdad the right to fully manage Kurdistan’s oil.
Exports from the Territory subsequently ceased.
An interim agreement signed between Baghdad and Erbil in early April stipulates that Kurdistan oil sales will be made through the Iraqi Oil Marketing Company “SOMO”, while revenues from the region’s fields will be deposited in a bank account with the Central Bank of Iraq or one of the banks approved by the Central Bank of Iraq.
Source: Dinar Recaps
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