EconSource: Iraq to Form ‘Oil Army’ to Protect Energy Assets From ISIS

Iraq is mobilizing an army of 27,000 security personnel to protect its oil and energy facilities from attacks by Islamic State (ISIS or ISIL) insurgents. Iraqi Oil Minister Adel Abdel Mahdi provided details about the new force following meetings of the Organization of the Petroleum Exporting Countries (OPEC) in Vienna. Abdel Mahdi said that the security force, which essentially amounts to an oil army, would be drawn from an existing energy police corp that is under control of the Interior Ministry. “Their mission is to secure all oil and electricity facilities,” he said. Abdel Mahdi added that meetings will take place in the coming weeks to finalize the structure of the force, which will receive additional training and equipment. In related news, the Pentagon said that the Iraqi government is making progress in its efforts to retake the country’s largest oil refinery at Baiji from ISIS. [The Telegraph, Business Insider, Newsweek, 6/8/2015]

Egypt inflation to fall to single digits in two to three years
Inflation in Egypt will slow to single digits within the next two or three years once a reform agenda has been implemented, Finance Minister Hany Dimian said. Egypt has been battling rising inflation since the government slashed subsidies in July 2014. According to the most recent data, Egypt’s annual urban consumer inflation slowed to 11 percent in April from 11.5 percent in March. Dimian said he expects inflation to fall back below 10 percent once reforms are implemented. Following the slight fall in inflation, Egypt’s central bank is expected to keep interest rates on hold rather than cut costs. Dimian added that he expects the government to finalize details of a value-added tax system in the coming days. [Reuters, 6/9/2015]

IMF official says Algeria needs structural reforms
Algeria must undertake “prudent macroeconomic policies” and launch “structural reforms” in its export sector in order to cope with a sharp drop in global oil prices, former International Monetary Fund (IMF) Chief of Mission for Algeria Zeine Zeidane said. He said structural reforms and fiscal consolidation “will allow for a reduction in imports and strengthen… external competitiveness.” Revenues from oil exports fell almost 43 percent in the first four months of 2015 compared to the same period a year earlier. Energy sales account for more than half of Algeria’s government budget. [Reuters, 6/9/2015]

Saudi ministry says higher oil output driven by demand
Saudi Arabia’s oil ministry said on Tuesday the rise in its oil production over the past three months was a result of increased global demand and the needs of its customers and was not designed to compensate for lower oil prices. An official source at the ministry also said its petroleum policy did not reflect personal views and were formulated by an integrated team of experts and specialists in oil market economics based at the ministry’s offices in Riyadh. The source said the statement was issued after the Wall Street Journal published a story last week about the kingdom’s oil policies, which the ministry said it considered inaccurate. [Reuters, The Telegraph, 6/9/2015]

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