Iraq Reroutes Oil Exports to Bypass Strait of Hormuz

The Government of Iraq is rerouting fuel oil exports through Syria and Jordan using thousands of trucks to bypass the Strait of Hormuz, which has been disrupted by war with Iran. This commercial operation, handled largely by Lytton SA and the Rania Group, has rapidly positioned Syria as the Middle East's top fuel oil export hub, accounting for 28% of regional volumes in June 2026.

To create a long-term alternative to the waterway, Oil Minister Basim Mohammed Khudair announced a feasibility study for a strategic pipeline extending from Basra to Kirkuk, with planned extensions to the port of Ceyhan in Türkiye and Baniyas in Syria. The Iraqi Ministry of Oil signed a memorandum of understanding with a consortium including Chevron Corp., TE Capital, and UCC to advance the project.

These efforts are supported by the United States, with Special Envoy and Ambassador Tom Barrack coordinating talks to rehabilitate the dormant Kirkuk-Baniyas pipeline. The U.S. government aims to integrate Syria into the global economy and weaken Iranian strategic leverage over the Strait of Hormuz. Other regional actors, including Saudi Arabia and the United Arab Emirates, are also expanding pipeline infrastructure to avoid the volatile waterway.