Iraq and Syria Partner with U.S. to Revive Oil Pipeline

The governments of Iraq and Syria signed a memorandum of understanding on July 17, 2026, to reconstruct the defunct Kirkuk-Baniyas crude oil pipeline. The project, finalized during a U.S.-Iraq business summit in Washington, aims to restore an export route from northern Iraq to the Syrian Mediterranean port of Baniyas. This initiative seeks to reduce Baghdad's dependency on the Strait of Hormuz, where shipping has been severely disrupted by the ongoing U.S.-Iran war, causing Iraqi oil production to drop from 4.2 million barrels per day in February to 1.9 million in June.

Chevron Inc. will lead the reconstruction as part of a U.S.-led international consortium. While some sources cite a nameplate capacity of 700,000 barrels per day, the U.S. State Department expects an initial transport capacity of 2 million barrels daily. In addition to the pipeline, Chevron signed agreements to manage the Nasiriyah project and the West Qurna 2 oilfield, the latter of which Iraq nationalized after U.S. sanctions hit the previous operator, Lukoil.

The pipeline agreement was a centerpiece of a broader investment summit where Iraq entered into approximately $60 billion in preliminary deals with U.S. firms across the energy, healthcare, and technology sectors, including a deal for SpaceX's Starlink to operate formally in Iraq. Iraqi Prime Minister Ali Falah al-Zaidi met with President Donald Trump and Chevron executives to secure these partnerships, stating that Iraq is pursuing an "open-door policy" to attract long-term investment to stabilize the region.