Oil prices opened the week 1 per cent down on Monday, weighing up the prospect of a return of Iraqi crude exports to the world market against possible supply curbs by the Opec cartel to avert a potential price crash. US Light crude fell 29 cents to $27.85 a barrel.Renewed downward pressure on oil prices came after comments by a US engineer that Iraq’s giant Kirkuk oil fields could start pumping within weeks. The northern fields are capable of producing up to 900,000 barrels per day (bpd) of Iraq’s pre-war production of roughly 2.5 million bpd. ‘‘It’s a definite possibility that could be just a few weeks away,’’ said Tom Logsdon, a member of the US Army Corps of Engineers charged with repairing Iraq’s oil fields. Logsdon said the southern oil fields, where output was up to 2.1 million bpd before the war began on March 20, could be up and running in less than three months.‘‘Depending how quickly workers come on line, we estimate we will have between 330,000 and 1,000,000 bpd being produced within 12 weeks from now,’’ Logsdon said.Oil prices fell about 10 per cent after the start of the war as US and British forces quickly secured a majority of Iraq’s oil infrastructure in the south of the country and traders predicted a swift end to hostilities. But any resumption of vital crude exports will be up to an interim authority in Baghdad in conjunction with the UN, where analysts forecast that diplomatic wrangling will keep Iraqi barrels off the market for months to come.Iraq’s crude could hit world markets just as demand is expected to wane by up to 2 million bpd. The second quarter sees a seasonal slump between winter demand for heating and the peak consumption of gasoline during summer vacations. Opec is planning an emergency meeting later this month to discuss tightening compliance to current output quotas or even possible curbs to formal limits.‘‘Higher prices, slower economic growth, warmer weather in the northern hemisphere and lower jet travel due to the SARS outbreak have all depressed the demand for oil,’’ said David Thurtell, commodities strategist at Commonwealth Bank in Sydney.‘‘We expect that with oil prices heading lower, Opec will try to be proactive in attempting to keep oil prices at, or above, $25 a barrel,’’ he said.
