Western oil companies see 'fantastic' future in Iraq, sign agreements

• Non-binding agreements and MOUs exceeded $60 billion, with Chevron investing in a pipeline to bypass the Strait of Hormuz and transport Iraqi oil to Syria's Mediterranean coast
• ConocoPhillips agreed to acquire 42% of BP Energy of Kirkuk Ltd to jointly redevelop four producing oilfields in northern Iraq with BP
• Iraq's oil exports have been severely impacted by the Iran war due to partial closure of the Strait of Hormuz, which typically handles 20% of global oil and gas flows

Western Oil Companies Sign Major Agreements with Iraq

Western energy companies signed over $60 billion in non-binding agreements and memorandums of understanding with Iraqi officials at a U.S.-Iraq business summit on July 17, 2026, as the OPEC member seeks to strengthen U.S. relations and develop alternative export routes to the Strait of Hormuz.

Key Developments

Major Deals:

• ConocoPhillips agreed to acquire a 42% stake in BP Energy of Kirkuk Ltd, partnering with BP to redevelop four producing oilfields in northern Iraq
• Chevron signed agreements to potentially enter Iraq's West Qurna 2 and Nassiriya oilfields, with plans to invest in a pipeline avoiding the Strait of Hormuz that could transport Iraqi oil to Syria's Mediterranean coast

Market Context

Iraq's energy exports have been severely impacted by the ongoing U.S.-Israeli war on Iran, which has caused partial closure of the Strait of Hormuz—a waterway normally handling 20% of global oil and gas flows. Iraqi Prime Minister Ali al-Zaidi emphasized an "open-door policy" for international investment during the summit at the U.S. Chamber of Commerce.

Strategic Implications

BP CEO Meg O'Neill described Iraq as having "fantastic potential from a resource perspective," citing its role in Iraqi and global energy security. Chevron's Jake Spiering suggested Iraq's long-term energy potential could position it as the Middle East's equivalent to major U.S. energy trading hubs like Henry Hub and Cushing.

Trump envoy Tom Barrack noted that while regional war has created chaos, Iraq is "at the forefront of a new strategic security alliance" with the U.S. and allies.