Looks like Saddam is doing is very best to drive oil prices lower and help out his friends in U.S.
But article suggest their will be a price to pay for not following good production practices.
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Iraq Oil Output Rises to Highest Level Since Before Gulf War
By Sean Evers
Baghdad, May 31 (Bloomberg) -- Iraq's oil production has risen to 3.1 million barrels a day, its highest level since before the 1990 Gulf War, and is set to climb further, the state's official INA News Agency reported.
Iraq, the fourth-largest oil producer in the Organization of Petroleum Exporting Countries, ``hopes to lift its output to 3.3 million barrels a day by the end of the year,'' said the country's Oil Minister Amer Mohammed Rasheed. Before the Gulf War, Iraq produced more than 3 million barrels of oil a day.
Though an OPEC member, Iraq isn't part of the 11-member group's production quota system because its foreign trade is subject to United Nations sanctions imposed after its 1990 invasion of Kuwait.
Until now, OPEC has resisted Iraq's request for a quota of more than 3 million barrels a day, though Saudi Arabia has said the exporters group will consider in September whether to give its Arab neighbor a quota.
Iraq produced about 2.66 million barrels of oil a day last month, according to a Bloomberg survey. As an exception to sanctions, the UN permits the country to export an unlimited amount of crude to buy food, medicine and spare parts for its oil industry.
Oil exports from Iraq, which account for about 3 percent of the world's daily crude supply, reached 2.5 million barrels a day in May, an increase of 800,000 barrels a day since March, said Rasheed.
Analysts estimate the country's total oil-extracting capacity at between 2.6 million and 2.8 million barrels a day, with production at the higher level damaging to its oil fields. That's because Iraq uses outdated technologies and equipment.
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