Ships are anchored in the Strait of Hormuz near the port city of Khasab on Oman’s northern Musandam Peninsula in May. (AFP/Getty Images via Bloomberg)
key takeaways:
- Iraq is preparing to boost oil exports from southern ports as an agreement to reopen the Strait of Hormuz is set to be signed on June 19.
- Anticipation of reopenings has eased supply fears, sending Brent below $80, while the IEA expects exports to gradually recover after the historic disruption.
- Iraq is enrolling tankers and coordinating with buyers, but officials said it will take time for production and exports to return to pre-war levels.
Iraq is preparing to boost oil exports from its southern ports with a formal agreement to open the Strait of Hormuz set to be signed on June 19.
“The country is taking the necessary steps to resume exports as soon as maritime navigation returns to normal,” said Oil Ministry spokesman Salim al-Rikabi. “Iraq is completing the process of designating tankers to load Iraqi crude oil,” he said.
A separate person with knowledge of the matter said some buyers had already told state marketing firm SOMO which tankers they wanted to use for loading since the peace deal was announced, and Iraq was dealing with those requests. Countries typically deliver oil to buyers at their ports, and customers are responsible for arranging transportation.
Iraq’s moves highlight preparations by major Middle Eastern producers to reroute their oil exports through the vital Strait of Hormuz, which has been largely closed since the war began nearly 110 days ago. There are already signs of shipping activity, with Iran rerouting its oil tankers and other ships to the Persian Gulf even before Washington and Tehran signed an interim deal to end their hostilities.
If the US-Iran deal holds, the formal reopening of the Strait of Hormuz would flood global markets with oil and provide some immediate relief from the worst supply disruption in history. While the International Energy Agency said on June 17 it expected the recovery in exports to be “gradual”, anticipation of more oil has driven prices to levels seen in early March, with benchmark Brent falling below $80 a barrel earlier this week.
Iraq has been increasing its exports through the Strait of Hormuz in recent days, shipping 1 million barrels per day in the first half of this month, according to data provided by SOMO Director General Ali Nizar.
New agreement between US and Iran offers possibility of gradual improvement in oil production and exports from the Gulf
Our new oil market report sees global oil supply falling by 4 MB/day in 2026 due to Gulf disruptions before rebounding in 2027 ⬇️ https://t.co/ZGcLwiA83E
– International Energy Agency (@IEA) 17 June 2026
That compares with exports of about 98,000 barrels per day in May from the country’s southern ports, according to tanker tracking data compiled by Bloomberg. Total shipments averaged 3.5 million barrels a day in the year through February.
Other countries in the region, including the United Arab Emirates and Kuwait, are also increasing stealth shipments and a growing number of tankers are turning off their transponders to avoid detection. The possible opening of the Strait of Hormuz would mean further increases in flows.
The pace of the increase will depend on how quickly tankers already inside the gulf can move out and empty tankers can move in. The ability of countries to increase their shuttered production will also determine how quickly exports can return to pre-war levels.
Al-Rikabi said Iraq’s oil fields would need some time to resume previous production levels, “which may vary from region to region.” However, there appears to be no damage to the export infrastructure.
