Battle for Basra jacks up global oil prices
The latest escalation in the ongoing struggle for Basra is affecting global oil prices. As news broke that one of Iraq's main oil export pipelines from Basra exploded, cutting at least a third of the exports from the city that provides 80% of the government's revenue, oil prices jumped more than $1 a barrel, Reuters reported. Jamal Hamed al-Fraih, spokesman for the South Oil Company, said the stricken pipeline was feeding crude to one of the main refineries in the province, at Shuaiba—for internal consumption. "Oil exports are still flowing but they are less than a few days ago," he said adding that oil exports from Basra, Iraq's main outlet, had been averaging 1.5 million barrels a day before the new outbreak of fighting. Prices leveled off after his clarification.
Moqtada al-Sadr's forces are refusing to back down in their fight for control of Basra, and his fighters in Baghdad took to the streets in a show of force, calling for the resignation of Prime Minister Nouri al-Maliki. The clock continues to tick on Maliki's 72-hour ultimatum for Sadr's Mahdi Army to lay down arms in Basra or face all-out assault. (CSM, March 27)
The initial news of the pipeline blast sent prices above $106 a barrel. Overall Iraqi oil exports have only recently returned to levels comparable to those before the US-led invasion. (Daily Star, Lebanon, March 27)