Oil & Gas

Iraq and Syria have agreed to explore the revival of the Banias pipeline, which would allow Iraqi crude to be exported through Syrian and Lebanese territories. This decision was reached during a meeting in Baghdad between Iraq’s Oil Minister Hayan Abdul-Ghani Al-Sawad and Syrian Energy Minister Mohammed Bashir, as reported by the Iraqi News Agency. A joint committee will be formed to assess the pipeline’s current condition, and an international consultant will be brought in to evaluate the feasibility of restarting operations.

Minister Al-Sawad highlighted Iraq’s recent progress in gas investment and oil refining, along with its ambitions to expand export capacities through southern ports. He also emphasized Iraq’s strategic interest in resuming exports via the Turkish pipeline through the Ceyhan port, and in studying export routes through the Syrian Banias and Lebanese Tripoli pipelines. These moves come amid regional shifts and a broader push to diversify Iraq’s export options.

A key part of this strategy involves the proposed Basra-Haditha pipeline, which is expected to have a capacity of 2.25 million barrels per day. This pipeline would serve as a vital link to ensure consistent export volumes through Syria, supporting the potential revival of the Banias route. The project reflects Iraq’s broader goal of enhancing infrastructure to stabilize and expand its energy exports amid fluctuating market dynamics.

Iraq’s financial plans also underscore its reliance on oil revenues. In mid-2023, the government approved a three-year budget based on an average oil price of $70 per barrel and daily crude exports of 3.4 million barrels. With annual spending set at approximately $153 billion and a projected deficit of $49 billion, parliament gave the finance ministry the flexibility to adjust expenditures depending on oil price trends. While Iraq bases its budget on a $70 benchmark, global oil prices have seen significant volatility, adding uncertainty to the country’s fiscal outlook.