Energy
0

Iraqi PM: Strait of Hormuz Disruption Would Harm Economy

Iraqi PM: Strait of Hormuz Disruption Would Harm EconomyIraqi PM: Strait of Hormuz Disruption Would Harm Economy

Any disruption in oil exports flowing through the Strait of Hormuz will be a “major obstacle” for Iraq’s economy, Iraqi Prime Minister Adel Abdul Mahdi said on Tuesday, as tensions continue to flare up in the Middle East.
Iraq has been studying ways around the vital chokepoint for oil exports for some time, but its options for doing so are limited, Oil Price reported.
Iraq has the fourth largest oil reserves in OPEC, behind Saudi Arabia, Iran and Venezuela. It is OPEC’s second largest producer and relies heavily on oil exports—as do most OPEC nations—and any disruption to its oil revenues would be of grave consequence. 
Its oil industry provides the country with 89% of its revenue, according to EIA.
Iran has announced that it is not seeking to close the Strait of Hormuz, but if the enemies' hostilities, mainly US sanctions, grow, the country will be able to do it.
Abdul Mahdi said most of Iraq’s oil is shipped through southern terminals. 
Iraq’s landlocked positioning in the Persian Gulf means that all of its southern exports must travel through the precarious Strait of Hormuz.
US President Donald Trump has vowed that if Iran did manage to close the Strait of Hormuz, it “wouldn’t be closed for long”. 
Oil prices rose on Wednesday, led by US crude after an industry group reported that US stockpiles fell for a fourth week in a row, alleviating concerns about oversupply amid global trade tensions.
West Texas Intermediate crude had climbed 81 cents, or 1.4%, to $58.64. Brent was up 61 cents, or 1%, at $64.77, having earlier hit $64.95.

Add new comment

Read our comment policy before posting your viewpoints

Financialtribune.com