Iraq declares force majeure on foreign-operated oilfields after Strait of Hormuz disruption
The Facts
- Iraq declared force majeure on oilfields developed by foreign oil companies.
- The decision was linked to military operations in the region that disrupted navigation through the Strait of Hormuz.
- The disruption has prevented most of Iraq’s crude exports from moving or being exported.
- Iraqi oil ministry sources said storage capacity had reached its limits because exports were being blocked.
- The Strait of Hormuz is described in the reports as a chokepoint for about 20% of global oil and liquefied natural gas supplies.
- Some reports said the oil ministry’s letter was dated March 17 and had been seen by Reuters.
- Reports said the force majeure measure allows suppliers or operators to suspend obligations or shipments without contractual penalties in extraordinary circumstances.
Context
What does force majeure mean in this context?
In the reports, force majeure is described as a contractual provision that can excuse suppliers or operators from fulfilling obligations, including shipments, when extraordinary circumstances make performance impossible НОВОСТИ Mai… Lenta.ru S A N A.
Why did Iraq take this step now?
The cited reason is that military activity in the region disrupted navigation through the Strait of Hormuz, which in turn blocked most Iraqi crude exports and left storage capacity full Reuters BERNAMA S A N A.
Why is the Strait of Hormuz important?
The reports describe it as a key chokepoint for global energy shipments, including roughly 20% of global oil and liquefied natural gas supplies Economic Times Straits Times BERNAMA.
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