Warning: Iraq’s reliance on the Strait of Hormuz exacerbates the risks to its oil exports amid alternative Gulf moves.
Iraq, OPEC’s second-largest oil producer, faces increasing challenges in securing its oil exports as Gulf states accelerate the development of alternative routes to transport crude away from the Strait of Hormuz, at a time when Baghdad still relies almost entirely on its southern ports to export most of its oil production to global markets.
An analysis published by Reuters indicates that Iraq is among the countries most vulnerable to any potential disruption to shipping traffic through the Strait of Hormuz, given that the bulk of its production is concentrated in the southern fields and it relies on Basra ports as a main route for oil exports.
According to the analysis, a number of Gulf states have already begun expanding alternative pipeline, land and sea outlets, giving them greater flexibility in the face of geopolitical risks, while Iraq still faces technical and political challenges that hinder the diversification of crude oil export outlets.
The report also indicated that Baghdad is considering strengthening northern export routes towards Türkiye, but these options still face obstacles related to infrastructure, political and security issues.
Analysts believe that Iraq’s continued reliance on a single main export outlet makes it more vulnerable to economic pressures in the event of disruptions to shipping through the Strait of Hormuz, which places the issue of diversifying export outlets at the forefront of the strategic challenges facing the Iraqi oil sector in the coming years.
Shafaq.com