Iraq prepares contingency plan for Strait of Hormuz blockade
19 March 2012
The government of Iraq has prepared and approved a contingency plan to deal with any supply disruptions arising from possible blockade of the Strait of Hormuz by Iran.
“Short and mid-term plans will be through boosting crude pumping and upgrading export capacity via Ceyhan port in Turkey. Also to increase the number of trucks that are shipping crude”, Reuters quotes government spokesman Ali al-Dabbagh.
On the back increasing sanctions from the US and EU, Iran had warned that it would close down the Strait of Hormuz if these sanctions cause severe damage to Iran and its oil revenues. The Strait of Hormuz is the single most important seaway in the world and Iraq ships almost 80% of its oil exports through Hormuz. Considering that Iraq exported over 2 million bpd oil in February, the Hormuz blockade could effectively wipe out more than 1.5 million bpd of oil supply.