IS Baghdad, in coordination with Tehran, plotting an oil revolution to challenge Riyadh’s domination of crude markets?

The game plan appears simple. Rising output from Iraq, the possibility of a deal between Baghdad and the autonomous Kurdish region and the prospect of Iran elbowing out of the cold, could act as a game changer — as far as global energy muscle is concerned.

As per the Economist Intelligence Unit, Iraq is ramping up oil exports in 2014.

It’s draft budget anticipates average exports of 3.4 mbpd, marking a nearly 30 per cent increase from 2013 export levels.

“Almost every second barrel of world oil production growth in the next two decades will come from Iraq, with the potential to provide prosperity for all of Iraq’s 32 million people,” underlines good, old friend Fatih Birol.

If announcements are to be taken seriously, Iraq is

determined to flood oil markets by tripling crude output capacity — to almost 9 mbpd — by 2020. And Hussain al-Shahristani, the Iraqi Deputy Prime Minister for Energy is hinting that upping the output is just part of Iraq’s (overall) plans — leading some to hint of a possible collusion between Baghdad and Tehran.

Al-Shahristani told industry delegates at a Chatham House Middle East energy conference that Baghdad was working with Iran to help it attract investment ahead of the possible lifting of sanctions.

“Iran has been in touch with us,” he told the London Telegraph.

“They want to share our contracts model and experience.”

Was it an oblique message to Opec? Jeff Selding analysing for Voice of America says experts believe the comments (by al-Shahristani) were actually meant to send a message to Opec.

“The game here is for control of the Opec,” Simon Henderson of the Washington Institute for near East Policy was quoted as saying.

“Baghdad and Tehran get on very well together and they are vying against Saudi Arabia, which is the other major power in the Gulf.

The energy side of it is that oil and gas is the main component of their overall strategy.”

“The cooperation between Iran and Iraq is more than just oil because both governments apparently share strategic interests,” underlined Nader Habibi of Brandeis University in a press interview.

“I am sure other countries in the region are closely watching the level of cooperation between Iran and Iraq (on the oil frontier).”

Iran’s leaders though have said little publicly so far about cooperating with Iraq on oil. Iraq can certainly boost oil production.

But it is still far from certain that Baghdad can triple its output by 2020.

The current state of security and the ongoing civil strife is just one of the many issues afflicting Iraqi output.

However, even if Iraq is able to achieve its target of boosting production capacity to the projected levels, it is unlikely to be able to put in place sufficient pipeline and port infrastructure to export the additional crude.

Iraq’s main export terminal for loading oil tankers at Al Faw near Basra will require billions of dollars worth of improvements in addition to the refurbishment of its pipeline network.

And then its ongoing tug of war with the Kurdish Regional Government (KRG), also casts aspersions on Baghdad’s aspirations.

Yet despite all this, eyes throughout the energy rich Gulf remains focussed on the next move of the Iraq-Iran duo on the energy chess board.

“The emergence of Iraq as an oil power of the nature of Saudi Arabia is the big thing in the future of the oil business,” said Henry Groppe, a seasoned oil and gas analyst from Texas, in an interview with Toronto’s Globe & Mail.

“It dwarfs everything else. It’s the thing that everybody ought to be watching and following as closely as possible.”

But Simon Henderson of the Washington Institute for near East Policy insists that Saudis “do not get embarrassed by anybody else’s antics in the oil market.

They are very experienced in oil policy, and usually from their own point of view, call it right” — at the right point in time. And he has a point.

Riyadh knows its strength and potential — and — rather well.