The Economist: Iraq's economy

Apr 20th 2007
From the Economist Intelligence Unit ViewsWire

Oil's not well in Iraq

The announcement of a study that suggests that Iraq's oil reserves could be almost as large as those of Saudi Arabia, the world's leader, has come amid fresh evidence of the monumental difficulty of realising that potential, as bombs in Baghdad left 200 people dead in a single day and Iraqi MPs wrangled over the details of new oil legislation.

The reminder of the scale of Iraq's unrealised oil wealth has come in the form of a report by IHS, an industry consultant, providing details of existing oil reserves and of more than 400 undrilled prospects and undeveloped discoveries. The Iraq Atlas estimates that Iraq has proven reserves of 116bn barrels (slightly higher than the standard industry figure), which could be supplemented by a further 100bn barrels in the barely explored desert region to the west of Baghdad. Saudi Arabia's reserves are put at 264bn barrels, with Iran occupying second place in the world ranking with 138bn barrels.