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Iran: We Will Be “Guardian Of Security” In Gulf, Strait Of Hormuz

Iranian officials have reassured Iraq that there would be freedom of navigation in the Strait of Hormuz, the most critical oil shipping lane in the world, the Iraqi oil ministry said on Tuesday.   

“Iranian President Hassan Rouhani (gave) reassurances to the Iraqi delegation ... around guaranteeing freedom of navigation in the Gulf and Strait of Hormuz and respect for international law guaranteeing that,” Reuters quoted Iraq’s oil ministry statement as saying.

Iraqi Prime Minister Adel Abdul Mahdi was visiting Tehran on Monday, where Iran’s President Hassan Rouhani said, “Iran has been, and will be, the main guardian of security and freedom of navigation in the Persian Gulf, the Strait of Hormuz and the Sea of Oman during history.”

According to the official website of the Iranian president, Rouhani emphasized “that the Islamic Republic of Iran is not willing to escalate tensions in the region and with other countries, and will never initiate war and tension.”

Tensions in the region and in the Strait of Hormuz have been escalating in recent weeks, the latest incident being Iran seizing a British oil tanker on Friday.

For Iraq, the Persian Gulf and the Strait of Hormuz, which Iran has repeatedly threatened to block, are the key export routes of more than 3 million bpd of Iraqi crude oil from its southern ports lying on the Persian Gulf.

Cutting off Iraq’s crude oil exports would be disastrous for the country, which relies very much on oil revenues to support its budget. Therefore, the Persian Gulf and the Strait of Hormuz are the lifelines for Iraqi state revenues, industry analyst Ruba Husari told AFP in June.

As tensions continue to flare in the Middle East, Iraq’s Prime Minister Adel Abdul Mahdi warned earlier this month that any disruption in the oil exports flowing through the Strait of Hormuz would be a “major obstacle” for Iraq’s economy.

By Tsvetana Paraskova for Oilprice.com

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  • Mamdouh Salameh on July 23 2019 said:
    Despite Iran’s assurances to Iraq, there is a real danger that if attacked or if its crude oil exports were prevented from passing through the Strait of Hormuz, Iran could block or mine the Strait of Hormuz so as to disrupt other Gulf countries’ oil exports including Iraq’s.

    Moreover, it could launch a kind of hybrid war – both directly and through its proxies – carrying out sporadic and widely dispersed attacks on shipping and other targets, sending oil prices, shipping costs and insurance premiums steeply up.

    Iraq is totally dependent on the Strait of Hormuz for its oil exports since the Iraqi-Turkish pipeline known as the ITP transporting Iraqi oil from Kirkuk to Ceyhan on the Turkish coast on the Mediterranean is currently out of action.

    Iraq now aims to increase its crude oil production from 4.6 million barrels a day (mbd) currently to 6.2 mbd by the end of 2020 and 9 mbd by 2023. Ongoing infrastructure constraints, however, may continue to thwart the realisation of these ambitions on schedule.

    Still, a major rise in Iraq’s oil production has to go hand in hand with an expansion of its oil infrastructure particularly oil pipelines and export terminals on the Gulf. Current Iraq’s export capacity is 3.8 mbd through terminal on the Gulf.

    Therefore, Iraq should very urgently consider extending the Iraq strategic oil pipeline to the Jordanian port of Aqaba on the Red Sea, enhancing its Gulf terminals to more than 5 mbd and also reaching an accommodation with the regional government of Iraqi Kurdistan to rehabilitate the ITP.

    Additionally, a new pipeline extending from Iraq’s southern oilfields across Syria to the Mediterranean could be considered once the civil war is over.

    Dr Mamdouh G Salameh
    International Oil Economist
    Visiting Professor of Energy Economics at ESCP Europe Business School, London

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