Oil expert: Iraq needs to build external oil storage tanks instead of export pipelines

Oil expert Hamza al-Jawahiri said on Tuesday that Iraq needs to reconsider its oil export strategy by moving towards building oil storage facilities in consuming countries with a capacity of up to one billion barrels, instead of relying on extending export pipelines through neighboring countries.

Al-Jawahiri explained in an interview with Shafaq News Agency that “the oil pipeline option, despite its importance, faces significant political and security risks, most notably that Iraq as a country is still in a relatively weak position, which makes the pipelines vulnerable to seizure or shutdown in the event of political disputes with the countries through whose territories they pass,” citing “the possibility of projects such as the export pipeline through Saudi Arabia being exposed to such risks.”

He pointed out that “the investment cost of establishing export pipelines is extremely high, as it may reach about $27 billion, in addition to the high costs of continuous maintenance and operation, as well as the fees imposed by the countries hosting the pipeline routes, which may be very expensive in the long term.”

The oil expert pointed out that “some countries were demanding high fees for the passage of oil through their territories,” explaining that “Jordan, for example, was supposed to receive up to $10 for every barrel exported through Jordanian territory under previous proposed projects.”

Al-Jawahiri explained that “the option of establishing strategic storage facilities in consuming countries may give Iraq greater flexibility in exporting, reduce the risks of political or logistical disruptions, and enhance Iraq’s ability to manage its oil flows more stably in global markets.”

Shafaq.com