Iraq is in the process of attempting to hire multiple oil tankers to transit the Strait of Hormuz, a move aimed at enhancing its crude oil deliveries to international markets. The state-run Iraqi Oil Tankers Co. has initiated this process, which has already received approval from the country's cabinet, as confirmed by a government spokesman on September 4, 2026. This initiative comes as global tanker freight rates are experiencing a significant surge, with supertanker earnings on the Middle East-to-China route reaching a record of nearly $800,000 per day by September 9, 2026, driven by ongoing conflicts in the Persian Gulf and complex workarounds.
While Iraq has stated it is trying to secure these vessels, specific companies have not yet been identified, and negotiations are ongoing. This effort follows a period where Iraq has seen an acceleration in oil loadings at its main port and increased shipments out of the Persian Gulf. By June 10, 2026, observed shipments of Iraqi oil exiting Hormuz or loading at Basrah had reached approximately 7 million barrels for that month, matching total volumes from April and May. This increase coincided with an Iranian exemption allowing Iraqi ships to use the Strait of Hormuz, potentially unlocking up to 3 million barrels a day of Iraqi oil cargoes, although questions remained about the scope and enforcement of this exemption.
The decision to charter tankers also aligns with Iraq's state oil marketing company (SOMO) reducing discounts on crude sold for pickup at northern Persian Gulf loading sites. This pricing adjustment, coupled with the effort to secure tankers for Hormuz transits, suggests Iraq is strategically managing its oil exports. The market for tankers willing to navigate the Strait of Hormuz remains constrained, with only a small group of operators currently participating, leading to producers like Iraq increasingly offering barrels for pickup in the Gulf of Oman as an alternative. Separately, the US has increased its reinsurance guarantees for ships willing to travel through the Strait of Hormuz to $40 billion, involving new insurance partners, in an effort to ease concerns and encourage traffic.
