Iraq, Opec’s second-largest oil producer, has begun exporting fuel oil through Syria as the Strait of Hormuz remains effectively shut to shipments amid the Iran war.
Oil is being exported by tanker overland to export terminals in Syria, Iraq’s Oil Ministry said on Thursday. It did not specify the total volumes being exported but said the amount would be gradually increased to boost oil revenue and support the country's economy.
Iraq, which produced about 4.35 million barrels per day and exported about 3.4 million bpd before the war, has seen a sharp drop in volumes amid the regional conflict.
Iraq’s energy infrastructure has come under attack, curtailing the country’s hydrocarbons production significantly. Its Majnoon oilfield was attacked twice, leading to a suspension of output at the field. Iraq also suspended its oil port operations on March 12 after two tankers carrying fuel were hit in its territorial waters near Basra.
Iraq also shut down oil production at Rumaila, its largest oilfield amid the war.
Its latest move comes after Iraq last month resumed oil exports from its Kirkuk fields to Turkey's Ceyhan port through a pipeline following a deal with the Kurdistan Regional Government.
About 250,000 bpd are being pumped to Ceyhan, with plans to increase volumes, Iraq's state-run North Oil Company said last month.
Iraq can pump between 200,000 and 250,000 bpd from northern oilfields in Kirkuk and that could be boosted by another 200,000 bpd from the Iraqi Kurdistan region.
The effective blockade by Iran of the Strait of Hormuz, through which a fifth of the world's oil and gas passes, has forced Middle Eastern countries to look for alternative routes to export to global markets.
Saudi Arabia has been exporting oil through the East-West crude pipeline connecting Abqaiq in the east to Yanbu on the Red Sea, while the UAE is relying on a pipeline running from Habshan in Abu Dhabi to Fujairah for oil exports.
Brent prices are currently trading at nearly $110 per barrel on supply concerns as the war shows no signs of ending.
US President Donald Trump on Wednesday said the country is looking to wind down the Iran war in two to three weeks, but also indicated it would hit Iran “extremely hard”, in the coming weeks, which boosted oil prices.
