Iraq’s oil production is expected to return to pre-war levels "within one to two months," according to official statements reported by state media. This forecast comes after the significant dip in production due to the closure of the Strait of Hormuz during the Middle East conflict, which saw a recent Memorandum of Understanding reached between Iran and the United States.
The Iraqi oil industry's spokesperson, Salim Farhoud, stated to the Iraqi News Agency on Friday evening, "We anticipate a return to previous production levels within one to two months." Before the conflict, production exceeded three million barrels per day, primarily from the southern oil fields.
Farhoud also noted that "fields with reduced production capacity are currently scaling up their output."
Iraq, a founding member of OPEC, relies on crude oil for 90% of its revenue. Prior to the conflict, it was exporting an average of 3.5 million barrels daily, mostly through the strategically crucial passage closed by Tehran in response to U.S. and Israeli attacks. Iraqi militia strikes, allied with Tehran, also targeted foreign-operated fields, including American-managed ones.
With oil storage filling up, Iraq had to halt production in most fields and resorted to limited exports through Syria and Turkey, according to AFP.
This week saw the reopening of the Strait of Hormuz following the Iran-U.S. agreement, ending four months of inactivity in a passage handling one-fifth of global oil and LNG exports pre-war.
Regarding oil exports, Iraq’s Oil Minister Bassim Khadim told the Iraqi News Agency that "export levels will resume gradually based on the fluid passage through the Strait of Hormuz." April's exports had plummeted from 93 million barrels to 10 million, officials indicate.
Iraq heavily depends on foreign currency from oil sales to cover imports, stabilize the dinar, and pay public sector salaries and pensions, impacting about 20% of its over 46 million population.