Iraq has declared force majeure on oil fields developed by foreign companies due to the effective halt of oil exports. The reason for this is disruptions in shipping in the Strait of Hormuz amid an escalation of the security situation in the region. This is reported by Reuters, according to UNN.
Details
According to the agency, military activity in the region has significantly restricted the movement of tankers through the strait, which is a key route for about 20% of global oil and liquefied gas supplies.
The Iraqi Ministry of Oil stated that exports have effectively stopped because international partners cannot send tankers to transport crude oil, despite the readiness of the state-owned company SOMO to carry out shipments.
Due to overflowing storage facilities, the authorities were forced to cut production. In particular, Basra Oil Company's production fell to approximately 900,000 barrels per day from about 3.3 million.
The declaration of force majeure means the suspension of contractual obligations for international operators and indicates the scale of the crisis.
This situation is expected to seriously hit Iraq's economy, which largely depends on oil revenues, and also create additional pressure on global energy markets.
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