Oil production in Iraq has fallen by 70%. “The most serious threat in 20 years”

Oil production from major fields in southern Iraq has fallen by 70 percent. due to Iran's blocking of transport through the Strait of Hormuz, which is crucial for the export of raw materials, Reuters reported on Sunday, citing three industry sources.

Oil production dropped to just 1.3 million barrels per day; before the US and Israel attack on Iran on February 28, extraction from fields in southern Iraq was approximately 4.3 million barrels per day, and exports of raw materials in February were approximately 3.3 million barrels per day.

– Oil storage facilities have reached their maximum capacity and the remaining production will be used to supply domestic refineries – said a representative of the state-owned Basra Oil Company, quoted by Reuters.

According to a senior Iraqi oil ministry official, the current situation is “the most serious operational threat Iraq has faced in over 20 years.”

The war in the Middle East has disrupted oil and gas exports from the region and forced production cuts by countries in the region, including Saudi Arabia, Iraq, Kuwait and Qatar. Israel has also limited some of its oil and gas production.

About 20 percent flows through Hormuz. of crude oil used in the world and about 20 percent liquefied natural gas (LNG). Iran's Islamic Revolutionary Guard Corps (IRGC) announced the closure of the strait on Monday evening and threatened to set fire to any vessel attempting to pass through the route.

On Friday, the administration of US President Donald Trump announced a reinsurance program worth $20 billion aimed at reviving shipping through this dangerous route. The United States also announced that its ships could escort ships sailing between the Persian Gulf and the Gulf of Oman. (PAP)

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