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ratifies treaties, and approves the nomination of certain high-rank-
ing government officials.
T
HE
E
CONOMY OF
I
RAQ
The production of oil is the most important part of Iraq’s economy.
Iraq has an estimated 140 billion barrels of proven oil reserves, giv-
ing it the fifth-largest reserves of any country in the world. The oil
flows from 70 oil fields throughout the country, from Kirkuk in the
northeast to Basra in the south.
Iraq has nine oil refineries. The two largest are in central Iraq—
one at Bayji, which is north of Baghdad, and another, called
Dawrah, in Baghdad.
Iraq fully nationalized the oil industry in 1975, and by 1979 it
was producing 3.4 million barrels per day (bpd). Production
dropped off during the Iran-Iraq War (1980–88), but by 1989 Iraq
had rebuilt its extraction and refining capability and was nearly
back to the 1979 production level.
After Iraq’s invasion of Kuwait and the Gulf War, oil production
fell to less than 600,000 bpd, due in large part to the United
Nations sanctions against the country. As Iraq was permitted to
export greater amounts of oil through the U.N.’s oil-for-food pro-
gram, production gradually increased, officially reaching about 2
million bpd during 2001. The
2003 invasion by the U.S.-led
coalition disrupted the oil
industry again, but by 2009
Iraq’s petroleum output was
back around 2 million bpd.
After years of neglect, the
infrastructure of Iraq’s oil
industry is old and prone to
breakdowns. The World Bank
I
RAQ
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Did You Know?
Some oil industry experts believe that a huge
amount of oil—possibly as much as another
220 billion barrels—may still lie hidden
beneath Iraq’s sands. However, the unrest in
the country over the past three decades has
made new exploration nearly impossible.