Iraq Cuts Losses to $60B as Oil Flows Resume via Omani Lane

Iraq and the United States reached an agreement to restore Iraqi oil exports through the Strait of Hormuz using a shipping lane near Oman, Foreign Minister Fuad Hussein said. In an interview with Al Jazeera, Hussein stated that disruptions caused by the Iran war and the resulting halt in shipments cost Iraq $60 billion in lost revenue.

Oil flow resumed in October after a steep decline in September. Iraqi energy officials reported that exports increased to approximately 3.5 million barrels per day in October, up from 2.65 million barrels per day the previous month. The recovery comes as the United States continues to push for tighter economic controls on Tehran.

US Treasury officials asked Iraq to close all but two of its border crossings with Iran. This measure is part of Washington’s campaign to increase economic pressure on the Iranian government. One of the two crossings that will remain open is located in the Kurdistan Region. Baghdad has already closed several crossings in recent weeks, including the Al-Sheeb crossing in the south, citing security needs and infrastructure upgrades.

Tehran criticized the closure of the Al-Sheeb crossing, stating that Baghdad did not provide advance notice. The diplomatic friction coincides with renewed violence in the waterway. Iran’s Revolutionary Guards announced on Wednesday that four oil tankers were destroyed after hitting naval mines in a prohibited route south of the strait. The IRGC also reported the seizure of two other vessels.

The following day, the IRGC said two oil tankers and a tugboat caught fire in separate incidents while attempting to use unauthorized routes. On Sunday, the Iranian navy reported that another oil tanker struck a naval mine east of the Strait of Hormuz and caught fire. These incidents underscore the ongoing risks for commercial shipping in the region despite the new understanding between Baghdad and Washington.