Iraq sets sights on 10 million barrels a day as Hormuz disruption bites

BAGHDAD, Aug 21 — Iraq's Prime Minister Ali al-Zaidi has announced his ambition to boost the nation's oil exports to a potential 10 million barrels per day within six years. Oil sales constitute nearly 90% of Iraq's revenue, but the country's exports have suffered due to the ongoing Middle East conflict between Iran and the United States, which has blocked the Strait of Hormuz.

Iraq, as an Opec founding member, was compelled to cease production in most of its oil fields during the war as reservoirs overflowed. Al-Zaidi, speaking at a Baghdad forum, stated that the government is striving to elevate Iraq's export share within the Opec+ framework and aims to reach between 8 to 10 million barrels per day in the next six years.

Iraq's oil production had previously been around four million barrels per day, with an average export of 105 million barrels monthly, primarily from Basra oil terminal through Hormuz. Due to the strait's disruption, Iraq initiated exporting crude through tankers via Syria and a pipeline to Turkey's Ceyhan port. Al-Zaidi emphasized that the closure of the Strait of Hormuz is a significant challenge, and Baghdad is working to augment oil exports through Ceyhan, Syria's Baniyas, and Jordan's Aqaba.

Following the Hormuz strait's closure, Iraqi oil exports experienced a minor resurgence to around 49 million barrels in July, with over 30 million of them sailing through the strait. In the initial two weeks of August, Iraq exported an average of two million barrels per day, marking its highest level since the onset of the Middle East war.

While Iraq heavily depends on oil sales for foreign currency earnings, authorities are aiming to diversify the country's economy.