Shafaq News- Baghdad
The closure of the Strait of Hormuz, one of the world’s most strategic energy corridors, poses a direct threat to Iraq’s oil exports, and prolonged disruption could force gradual production cuts, an expert told Shafaq News on Monday.
Economic expert Mohammed Al-Hassani warned that if exports of between 3.3 and 3.5 million barrels per day were halted, and assuming an average price of $80 per barrel, Iraq could lose between $260 million and $280 million per day in oil revenues, exceeding $8 billion per month.
Iraq relies almost entirely on export outlets linked to Basra Oil Company operations, which depend on storage facilities in Al-Faw, Khor Al-Zubair, and Al-Zubair oil depots, in addition to facilities in Rumaila and West Qurna. These, he noted, are operational tanks designed to regulate export flows rather than provide long-term strategic storage.
According to Al-Hassani, Iraq produces more than four million barrels per day, while its effective storage capacity remains limited, meaning tanks could fill within days or weeks if tankers stop loading. Additionally, Iraq lacks the external storage flexibility enjoyed by some Gulf oil producers, which maintain overseas storage facilities, particularly in Asia, giving them greater room to manage supplies during crises.
An alternative would be reactivating the northern export route via Turkiye’s Ceyhan port, linked to North Oil Company operations, “but its capacity remains limited and would compensate for only a fraction of southern exports.”
Oil prices rose about 7%, reaching their highest levels in several months amid escalating geopolitical tensions in the Middle East and growing concerns over supply disruptions through key crude transit routes.
On March 1, Iraq participated in an emergency OPEC+ meeting to discuss increasing oil production amid shipping disruptions through the Strait of Hormuz caused by the US-Israeli war on Iran and the suspension of operations by several shipping companies in the waterway.
Earlier, Iran’s army and the Islamic Revolutionary Guard Corps announced the closure of the Strait of Hormuz and warned that the route was unsafe amid the ongoing exchanges between Iran, the United States, and Israel.