BAGHDAD, Iraq -- Iraqi oil production fell by 8 percent last year, with a sharp decline near year's end that left average daily production at half the 3 million barrels envisioned by U.S. officials at the outset of the war in 2003.

Prospects for improvement this year are slim, according to many experts, calling into question Iraq's ability to support itself and fund reconstruction efforts as U.S. assistance is scaled back. Reasons for the shortfall include the poor state of the nation's oil fields, a creaky infrastructure, poor management and ongoing insurgent attacks, particularly to pipelines in the north-central region meant to export oil through Turkey.