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Iraq

Volume 400: debated on Wednesday 26 February 2003

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To ask the Secretary of State for Trade and Industry pursuant to his Answer of 10 February 2003 to the hon. Member for Hertford and Stortford (Mr. Prisk), Official Report, column 620W, on world oil prices, what estimate he has made of the effect of (a) a short conflict in Iraq and (b) a prolonged conflict in Iraq on the underlying supply and demand situation for oil. [99133]

No decision has been taken to launch military action against Iraq. Iraqi oil production currently stands at around 2.5 million barrels per day only 3 per cent. of total world oil production and of which only around 1.5 to 2 million barrels per day is exported. There are a number of other factors such as the weather, supply from other countries, etc which affect the underlying demand and supply balance of the oil market: e.g. OPEC producers are likely to increase their production to cover any loss of Iraqi supply; seasonal oil demand is reducing; and the International Energy Agency has general arrangements in place to take international action, including release of stocks, in case of a supply disruption.