Iraq seeks to export 10 million barrels of oil per day within six years

Iraq, which derives approximately 90% of its revenues from crude oil sales, is seeking to increase its oil exports to reach a daily average of between 8 and 10 million barrels within six years, according to Prime Minister Ali al-Idabi on Friday.

Iraq is a founding member of OPEC and recently urged the organization to raise its production quota due to the severe economic repercussions of the Middle East war, which intensified after Iran closed the Strait of Hormuz, the vital waterway through which most of Iraq’s oil exports previously flowed.

Speaking at a dialogue forum held in Baghdad, al-Idabi said, “We are working to increase Iraq’s export share through OPEC, aiming to reach 8 to 10 million barrels per day within six years.”

Before the war, which erupted with a US-Israeli attack on Iran in late February, Iraq produced approximately four million barrels of oil daily and exported an average of 105 million barrels monthly, mostly from Basra in the south, via the strategically vital Strait of Hormuz for global energy supplies.

However, Iran’s closure of the waterway forced Iraq to halt production at most of its fields after storage tanks filled up, compelling it to resort to limited exports via Syria using tanker trucks and to Turkey via a pipeline to the port of Ceyhan.

After being briefly reopened following the signing of a memorandum of understanding with Washington in June, Tehran resumed restrictions on navigation in the Strait of Hormuz following the resumption of hostilities in early July.

On Friday, al-Idabi affirmed that “the closure of the Strait of Hormuz poses a significant challenge,” noting that his government is working on “expanding oil exports through the Turkish port of Ceyhan (...) and through exports via Baniyas in Syria and Aqaba in Jordan.”

Following a sharp decline in Iraqi oil exports after the closure of the Strait of Hormuz, shipments rebounded slightly in July to reach approximately 49 million barrels, with more than 30 million of those passing through the Strait of Hormuz.

In the first half of August, Iraq exported an average of two million barrels of oil per day, the highest level since the start of the Middle East war.

Iraq relies heavily on foreign currency generated from oil sales to finance imports, stabilize the dinar, and pay the salaries of public sector employees and retirees, who constitute approximately 20% of the population, which exceeds 46 million.