Iraq is accelerating oil loadings at its main port and boosting shipments out of the Persian Gulf, indicating that top OPEC producers in the region are increasing barrels through the crucial Strait of Hormuz. Tanker-tracking data compiled by Bloomberg reveals that observed shipments of Iraqi oil exiting Hormuz or loading at Basrah, Iraq's southern port, total roughly 7 million barrels this month. This volume already matches the total crude loaded and shipped in April and May, coinciding with recent departures of previously stranded tankers carrying Iraqi oil.
Following a US-Iran deal aimed at fully reopening the Strait of Hormuz, Iraq has instructed operators of five major oil fields to raise production to pre-war levels, targeting an output of over 3 million barrels a day. The Basra Oil Co. specifically requested increased capacity at the Rumaila, West Qurna-1, West Qurna-2, Zubair, and Artawi fields, according to a document dated June 19. An Oil Ministry spokesman, Salim Al-Rikabi, stated that the return to higher production will be gradual and contingent on operational conditions and buyers arranging tankers for loading.
Iraq has been actively preparing to boost oil exports from its southern ports, with a formal deal to open the Strait of Hormuz scheduled for signing on Friday, June 28. According to Ali Nizar, director general of SOMO, Iraq shipped 1 million barrels per day (MMbpd) in the first half of June through Hormuz, a substantial increase compared to the roughly 98,000 barrels per day observed in May from its southern ports. Total shipments in the year through February averaged 3.5 MMbpd. The anticipation of more oil entering the market has led to a significant drop in prices, with benchmark Brent crude falling below $80 per barrel earlier this week.
The country is undertaking necessary steps for exports to resume "as soon as maritime navigation returns to normal," explained Oil Ministry spokesman Salim Al-Rikabi. This includes completing the process of nominating tankers to load Iraqi crude oil. While the International Energy Agency anticipates a "gradual" recovery in exports, Iraq's actions highlight broader preparations by major Middle Eastern producers to restore oil exports through the Strait, which has been largely closed for about 110 days due to conflict. Although the full reopening is pending, there are existing signs of increased shipping activity, with Iran moving its own oil tankers and other vessels diverting towards the Persian Gulf.
