Iraq may restore 80% of oil output within four months

Shafaq News- Baghdad

Iraq and other Middle Eastern oil producers may needaround four months to restore nearly 80% of pre-war production levels followingdisruptions caused by the regional conflict and export restrictions in theStrait of Hormuz, S&P Global estimated in a new report.

Oil output in Iraq has fallen to about 1.3 millionbarrels per day from roughly 4.3 million before the conflict, while exportsdropped below 800,000 barrels per day because of shipping disruptions in theStrait of Hormuz during the US-Israeli war on Iran, causing estimated dailylosses of around $128 million.

S&P Global noted that Iraq was among the countriesforced to reduce production during the early stages of the conflict because ofstorage constraints and export difficulties. The report projected a gradualrecovery, clarifying that many oil fields in the country and across the regionrely heavily on water and gas injection systems to maintain reservoir pressure.

Prolonged shutdowns complicaterestart operations by requiring multiple overlapping phases, includingrestoring logistics services, reducing inventories, and gradually returningoutput to previous levels, the company noted, warning that full recovery couldextend beyond four months and that oil and gas production costs may risebetween 4% and 6% if the conflict remains contained, potentially reaching 15%in the event of an extended escalation.

: Iraq's oil lifeline is blocked: The crisis runs deeper than Hormuz