Key facts
- Iraq's cabinet approved a three-month mechanism for crude oil exports.
- Specialized international and local companies will be involved in the export process.
- Contracts will commence on September 1 and run for three months.
- All national oil fields are prepared for immediate export operations.
- Exports from Kurdistan via the Iraq-Türkiye Pipeline are set to restart.
- International oil companies will receive compensation during an interim export period.
Iraq's cabinet has approved a three-month mechanism for exporting crude oil through specialized international and local companies, set to begin on September 1. This decision follows recent regional hostilities and signals the country's intent to aggressively re-enter the global energy market.
The Ministry of Oil officially announced its preparation to resume crude exports from all national fields, emphasizing an 'open door policy' for international companies to diversify its buyer base and maximize revenue. All oil fields are reported to be fully prepared for immediate export operations, with alternative outlets, including the Banias route via Syria, to be maintained alongside the primary Basra terminals.
Agreements have been signed between the Kurdistan Regional Government (KRG), the Federal Government of Iraq (FGI), and several international oil companies (IOCs) to enable the restart of international crude exports from the Kurdistan Region via the Iraq-Türkiye Pipeline. Pipeline exports from the Shaikan Field are expected to resume in the coming days. During an interim period, anticipated to be around three months, IOCs will be compensated for exported production to cover production and transportation costs. Gulf Keystone Petroleum, an IOC operating in the region, expects this to improve its realized prices to above $30 per barrel.
The acceleration of exports is intended to maximize state budget revenue, which is crucial given high global prices post-ceasefire. Increased crude production also supports the supply of fuel for national power plants. The arrival of a supertanker carrying 2 million barrels at Basra ports, the first since the reopening of the Strait of Hormuz, has already signaled market stability.