Despite being an oil-rich country Iraq is struggling to meet energy demands.
Iraq is seeking gas supply from leading energy producer Qatar in an effort to address decades of power shortages.
According to the Iraqi News Agency (INA) the crisis was discussed during a meeting in Doha between Qatar’s Energy Minister, Saad Sherida Al-Kaabi, and Iraq’s acting Minister of Electricity, Adel Karim.
“During the visit, all logistical issues necessary for the supply of gas through the Qatari ports to Iraq’s ports were discussed,” read a statement by Baghdad’s electricity ministry.
Iraqis have been facing power outages for more than 30 years, despite Iraq being amongst the top 10 oil-rich countries in the world. It is also OPEC’s second-largest producer after Saudi Arabia, with oil sales accounting for 90% of its revenues.
Electricity outages are a common occurrence especially during the scorching summer heat in Baghdad, where energy supplies are insufficient.
Iraq’s energy crisis has been attributed to decades of instability and corruption, which left the country unable to address the situation until now. The 2003 US invasion has also left the country in a state of paralysis as it continues to recover from the war.
There have been several large-scale protests across the country place over the lack of basic services and corruption. In 2021 protests drove former Electricity Minister Majid Mahdi Hantoush to resign.
The lack of power supply is taking a toll on Iraq’s health ministry during the Covid-19 outbreak. Hospitals are overloaded with patients who need urgent medical care.
Depending on its neighbours
Baghdad heavily relies on Iran for gas and electricity imports as it lacks essential facilities to process gas into fuel. It has also been facing pressure from the US to reduce its dependency on Iran.
Last year, Iran decided to halt its power supply to Iraq for its inability to pay back the Islamic Republic for energy imports. According to the Associated Press (AP), Iraq owed Iran $4 billion.
Iraq would have to bypass harsh US sanctions on Iran in order to pay for its energy supply rather than directly paying the Islamic Republic. Those sanctions were reimposed when the US unilaterally withdrew from the 2015 nuclear accord under the former Donald Trump Administration in 2018.
The US State Department had granted Iraq a sanction waiver last December for 120-days, enabling it to import electricity from Iran to meet its energy needs.
Iraq has also been diversifying its power imports, signing agreements with leading energy companies across the world.
In September last year, Baghdad signed a $37 billion agreement with French oil and gas company, Total. That deal included the building of solar energy panels and developing its oil field in Basra.
The agreement pertaining the Artawi oil field in Basra hopes to accelerate its output from 85,000 barrels per day to 210,000.
Saudi Arabia and Iraq also signed a memorandum of understanding to connect their electricity grids.