Iraqi oil output hits highest level in more than three years

PARIS -- Iraqi oil output has risen in a "dramatic" way in recent months, hitting its highest monthly level in about 3 1/2 years in November, the International Energy Agency said Friday.

The Paris-based agency, in its monthly oil market report, cited improving security as it reported that Iraqi production rose to 2.32 million barrels per month in November, a slight increase from October and up from 1.9 million barrels per month in January.

The increase in output resulted largely from "more regular" pipeline crude shipments from fields around the northern city of Kirkuk to Ceyhan in Turkey, the IEA said.

Iraq's oil industry has come under repeated attack since the war began, primarily through bombings of key pipelines. Other obstacles include the failure of political leaders to agree on a formula for sharing Iraq's oil wealth among its divided communities and conflict over control of oil-rich territory. Iraq's underperforming oil industry has been an additional headache for its fledgling government.

The agency said Iraqi output had reached its highest level since the spring of 2004, when the anti-U.S. insurgency started to intensify following the overthrow of Saddam Hussein a year earlier.

"While few would have predicted such an improvement in Iraqi security and output since September, the additional oil has been as welcome for the international market as it has been for Iraqi finances," the report said.

"But though the increase has been dramatic, the market continues to recognize the propensity for ongoing security issues and output volatility," it added.

Iraqi output increased by 330,000 barrels per day from August to November alone, the agency said.

Since the 2003 U.S.-led invasion that removed Saddam from power, Iraqi production has mostly hovered between 1.7 million and 2 million barrels per day, the IEA said.