Authored by Zainab Calcuttawala via OilPrice.com,
Oil revenues still are not high enough to allow the Iraqi government to fund the reconstruction of the country, according to Iraqi Prime Minister Haider Al-Abadi.
“Oil prices are not at the required level to be used for sustainable development,” state TV quoted al-Abadi as saying during a press conference.
Iraq proclaimed itself victorious earlier this year after a three-year, hard-fought war against the terrorist Islamic State.
The victory freed up some money - but not enough - for reconstructing the nation after almost 15 years after the demise of dictator Saddam Hussain and the fall of his regime.
The oil price crash of 2014 has made it difficult for fossil-fuel dependent countries to provide key government services to its citizens, and Iraq was not immune.
In Iraq, years of financial mismanagement and domestic conflict exacerbated existing civil governance issues.
Just over a month has passed since the Kurdish referendum, which resulted in a near-unanimous vote for the Kurdistan Regional Government to secede from Iraq.
Baghdad has not accepted the results of the vote, moving instead to deploy its military to secure control of the Kirkuk oilfields, which, though located in northern Iraq, do not lie in areas legally allotted to the KRG.
The political consequences of the referendum have played out in a recent deal with Iran.
With the Kurdistan autonomous region heavily dependent on oil revenues, chances are the government will seek to come to a mutually beneficial agreement with the central government in Baghdad.
Yesterday, the region’s Prime Minister, Nechirvan Barzani acknowledged the adverse effect that the Iraqi offensive has had on the region’s oil income, saying it had fallen to less than 50 percent of what it used to be before October 16, when the offensive was launched.