Iraq Restores Oil Capacity to Three Million Barrels Per Day Despite Strait of Hormuz Disruptions

Iraq has successfully increased its crude oil production capacity to over three million barrels per day, enhancing hydrocarbon exports in September despite ongoing disruptions in the Strait of Hormuz, according to the country's oil minister. As Opec’s second-largest producer, the nation aims for further growth as new alternative pipelines and upgraded export infrastructure become operational, Bassim Khudair shared with the Iraqi News Agency.

"Iraq has been able to export three million barrels of oil per day since the beginning of September," the state news agency quoted him stating on Saturday. “The government plans to increase export capacity to five million barrels per day after the completion of the strategic pipelines extending to Fishkhabour and Baniyas, in addition to the export terminals in the Strait of Hormuz."

Iraq has been among the producers most severely impacted by the Iran conflict, as Tehran effectively closed the strait and targeted commercial ships. Consequently, Iraq's oil exports fell sharply from about 4.2 million bpd in February before the war began to approximately 1.45 million bpd within a three-month period, according to Opec data. Violence involving commercial shipping and hydrocarbon tankers in the strait persisted following the breakdown of the June ceasefire agreement between Iran and the US.

Recent escalations in retaliatory strikes between the US and Iran have further reduced peace prospects. On Saturday, the US announced it struck three Iranian oil tankers following a Tehran attack on American naval vessels.

With the strait—which previously handled a fifth of global oil and gas supplies—remaining closed, Iraq negotiated direct passage for its tankers with Tehran. During the final week of August, Iraqi President Nizar Amidi announced that Iran had authorized passage for several Iraqi oil tankers through the waterway.

"There is facilitation for some tankers carrying Iraqi oil in the Strait of Hormuz," he stated, omitting specifics regarding the agreement. The Iranian state news agency Irna confirmed that Tehran granted permission for Iraqi vessels to navigate the route following consistent requests from Baghdad. This authorization was a primary objective during Iranian Parliament Speaker Mohammad Bagher Ghalibaf's official visit to Iraq.

Alongside seeking passage through the waterway, Iraq is advancing pipeline projects connecting to Ceyhan in Turkey and Baniyas in Syria to bypass the strait entirely, having already finalized an agreement with Syria regarding the Haditha-Baniyas oil pipeline.