Iraq-Syria Oil Pipeline to Bypass Hormuz Is 4 Years and $15 Billion Away

A $15 billion pipeline project that would bypass the Strait of Hormuz and transport Iraqi crude to Syria's Mediterranean coast remains at least four years away, according to sources familiar with the endeavor. Supported by the U.S. Administration as a means to diminish the significance of the Hormuz in global oil supply, the pipeline is being evaluated by a consortium that includes Chevron.

The U.S. anticipates the project will render Hormuz "irrelevant" within two years, but the actual construction process is projected to take at least four years. The existing pipeline, which has been idle for over two decades, cannot be utilized for the new project, necessitating the establishment of new infrastructure. This added complexity is expected to increase costs and prolong the project's timeline.

However, the crisis in Hormuz, which has curtailed most of Iraq's crude oil exports, has hastened plans for Iraq and Syria to reconstruct the damaged pipeline to convey crude oil from Iraqi fields in Kirkuk to Syria's Mediterranean port of Baniyas. The Syrian Petroleum Company's CEO, Youssef Qablawi, stated that the renovation of the pipeline from Haditha in Iraq to Baniyas would take "three years at most."

Negotiations between Syria and Iraq to finalize the contract and discussions with potential investors are currently underway. The project is anticipated to comprise two pipelines, each capable of processing between 1.5 million barrels per day and 2 million bpd. The U.S. expects U.S. companies to participate in the renovation of the Kirkuk-Baniyas oil route.

This pipeline would be pivotal for Iraq's oil exports, as it would no longer rely on the Hormuz, benefitting Syria's post-war economy, and curbing Iranian influence in the Strait of Hormuz.