Iraq’s plans for new oil export pipelines to Turkey and Syria have been galvanized by the Middle East conflict and the threat to navigation in the Strait of Hormuz. Iraq and its Gulf neighbors (MEES, 9 October) seek greater flexibility in how they bring crude to market, but such optionality comes at a price. The latest internal estimates put the cost of the proposed pipeline network at around $25bn.
The conflict cost Iraq at least $20bn in lost oil export revenues in the first half of the year alone, on a conservative estimate. A pipeline network that bypasses Hormuz could therefore pay for itself over the long term. But financing the upfront investment will be difficult for a chronically cash-strapped government already struggling to provide essential services such as reliable electricity (MEES, 2 October). (CONTINUED - 1945 WORDS)
