Iraq’s Balancing Act: A Push for Fossil Fuels Amidst Climate Concerns, 9 OCT

Iraq’s Balancing Act: A Push for Fossil Fuels Amidst Climate Concerns

At the United Nations Climate Week, Iraqi Oil Minister Hayyan Abdul Ghani underlined the persistent global demand for fossil fuels, while also advocating for significant investments in renewable energy. The comments came amid an era where the global discourse is gradually shifting towards clean energy sources, and countries are scrambling to balance their economic needs with environmental concerns.

Emphasizing on a Dual Investment Strategy

Abdul Ghani stressed the necessity of substantial investments in both fossil fuels and clean energy sources. This dual investment strategy underscores Iraq’s attempt to stay relevant in the global energy market while also recognising the imminent need to mitigate the impacts of climate change. The minister’s call can be seen as a plea for a more realistic transition strategy that respects the current energy market’s dynamics, particularly for countries heavily reliant on fossil fuel exports.

Transitioning towards Natural Gas

The Iraqi government has been gradually shifting its focus towards using natural gas for electricity generation – a cleaner alternative to oil. This move is seen as a tentative step towards a more sustainable energy sector. Abdul Ghani predicted that oil demand would increase by two million barrels per day next year, hinting at the continuing relevance of fossil fuels in the global energy mix. In September, Iraq earned $9.5 billion from crude oil exports, exporting approximately 103 million barrels, signaling the economic importance of fossil fuels for the nation.

Addressing Climate Change

Despite the emphasis on fossil fuels, the Iraqi government is not turning a blind eye to the impacts of climate change. The Prime Minister of Iraq, Mohammed Shia al-Sudani, promised comprehensive measures to tackle climate change, including plans to meet a third of the country’s electricity demands using renewable energy. Climate change has had a significant impact on Iraq, leading to droughts, water shortages, and increased respiratory illnesses. Hence, the government is formulating a national plan to combat climate change, which includes building renewable energy plants and protecting the country’s biodiversity.

The Broader Middle East Perspective

The ministers from other Middle Eastern and North African countries also discussed the roles clean energy could play in their economic future during a high-level dialogue hosted by the International Energy Agency (IEA) and the Ministry of Energy and Minerals of Oman. They acknowledged the need for energy transitions and the potential reduction in export revenues from fossil fuels in the future. The ministers highlighted the opportunities for economic growth through the transition to a lower carbon economy and emphasized the importance of cooperation and dialogue in achieving clean energy goals.

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"RV UPDATE" BY MNT GOAT & CLARE, 8 OCT

 Mnt Goat 

  I asked [my CBI contact in Iraq] about the project to delete the zeros and was told it is coming and is now an active project no longer just a later project.

 I asked for some target dates and was given that they planned to redenominate sometime prior to the end of the year. To me this is so inline what we are thinking for a January 2024 reinstatement timeframe and other events also lining up.

Clare  

Wall Street Journal Article:   "Iraq Asked for $1 Billion in Cash. This Time, Washington Said No." 

 Quote:   "Iraq is seeking a special shipment of $1 billion in cash from the Federal Reserve Bank of New York, but U.S. officials have withheld approval, saying the request runs counter to their efforts to rein in Baghdad’s use of dollars and halt illicit cash flows to Iran.  

Since the U.S. invasion of Iraq two decades ago, the U.S. has supplied $10 billion or more a year to Baghdad on semimonthly cargo flights carrying massive pallets of cash, drawn from Iraqi oil sales proceeds deposited at the Fed. In Iraqi hands, the bank notes have become a lucrative source of illicit dollars for powerful militias and corrupt politicians, as well as for Iran, U.S. officials say"

 Article:  "Iraq prohibits cash withdrawals in dollars as of the beginning of 2024".

 Quote:   "A senior official in the Central Bank of Iraq said that the country will ban cash withdrawals and transactions in US dollars as of January 1, 2024, in the latest effort to limit the misuse of the country’s hard currency reserves in financial crimes...dollars deposited in 2024 can only be withdrawn in local currency at the official rate of 1,320 dinars to the dollar.

Kurdistan PM meets US Embassy Representative: focus on political developments and oil exports , 7 OCT

 Kurdistan PM meets US Embassy Representative: focus on political developments and oil exports , 7 OCT

Shafaq News/ On Wednesday, the Kurdish Prime Minister, Masrour Barzani, met with David Berger, the Chargé d'Affaires at the US Embassy in Iraq. The meeting centered on political developments in Iraq and the pivotal topic of resuming oil exports through Turkey.

A statement by Barzani's office said that the prime minister and Berger delved into the latest developments and the overall situation in Iraq, emphasizing the vital necessity of safeguarding the constitutional and financial rights of the Kurdistan Region.

A significant consensus emerged during the meeting, highlighting the urgency of restarting oil exports from the Kurdistan Region through the Turkish port of Ceyhan. Both sides stressed the importance of swift action in this regard, underscoring the economic significance of this step for the Kurdistan Region.

The two sides discussed the Kurdistan Parliament elections, indicating the commitment to democratic processes in the region.

Furthermore, the Chargé d'Affaires of the US Embassy in Iraq expressed gratitude to the Kurdistan Regional Government for its rapid response and support to the tragic Al-Hamdaniyah fire incident victims. 

He commended the peaceful coexistence enjoyed by the diverse components of the Kurdistan Region, highlighting Kurdistan's pluralistic and harmonious social fabric.

https://shafaq.com/en/Kurdistan/Kurdistan-PM-meets-US-Embassy-Representative-focus-on-political-developments-and-oil-exports

Iraqi Dinar Redenomination | Project to Delete the Zeros is Active! | Ta...

"RV UPDATE" BY MILITIAMAN, 7 OCT

Militia Man  

 The parallel market is a black market.  It's illegal.  They're not supposed to be doing it.  They're only supposed to be doing trade in dinar...At some point in time, whether it be today, tomorrow, the next day or out to the end of the year, they're going to de-dollarize the country...

There's illicit trade going on and there's fraud/money laundering and the ultimate goal is to get rid of it...If you're going to de-dollarize the country you're going to need to bring it [dinar] some value because a dollar is worth a lot more than a dinar at the moment...

 Iraq went to the U.N. and told everybody they were a free sovereign state.   That goes along with having a sovereign currency...and then to be able to go into the international financial system...

All of that is on the table...I don't think there is anything stopping them.    I don't know if this is going to happen in the next 24-48 hours or if it's going to still be a significant amount of time.  Bottom line is we can see them moving forward ...I'm elated and I think it's going to be a good week. 

Central Bank of Iraq update today 2023 / Forex update & HCL payments / i...

Expert says CBI should stop acting like a forex speculator, 7 OCT

 Expert says CBI should stop acting like a forex speculator, 7 OCT

Shafaq News/ An Iraqi economic expert on Saturday said that the Central Bank of Iraq (CBI) should stop selling dollars in exchange for the national currency, suggesting leaving this matter to the "black market" in a bid to achieve market stability.

"There are two main reasons behind the abrupt increase in the dollar exchange rate," Dana Mawloud told Shafaq News Agency, "First, it was the CBI announcement that it would halt the injection of dollars into the market starting from the beginning of the coming year. Media sensationalism has played a role also, affecting the decisions of citizens to hoard dollars instead of the local currency."

On the reasons behind the Central Bank of Iraq's decision to stop injecting currency in 2024, he added, "The Central Bank of Iraq, in coordination with the International Monetary Fund, has made this decision with the approval of the US Treasury. It will be implemented starting from January 1st next year to prevent the US dollar from reaching Iran and Turkey from Iraqi markets, as those two countries are the largest purchasers of US dollars from Iraqi markets."

"The Central Bank is the sole entity selling foreign currency in the markets and acts as the exchange office. There is no bank or financial institution in the world that operates by selling its reserves of foreign currencies."

"The issue should be left to the black market, and the central bank and other banks can exchange foreign currencies at the government-set rate," he explained, "this way, the exchange rate of the dollar would stabilize between the government-set rate and not exceed 137,000 dinars per 100 dollars."

He also pointed out that "the reasons for currency smuggling stem from the fact that the dollars injected by the Central Bank of Iraq do not go to the citizens but to banks and companies that do not benefit the Iraqi citizens."

Today, the exchange rate of the US dollar against the Iraqi dinar closed at 158,500 dinars to in the Sulaymaniyah stock exchange.

https://shafaq.com/en/Economy/Expert-says-CBI-should-stop-acting-like-a-forex-speculator