Iraq oil output drops 60% as Iran war blocks tankers through Strait of Hormuz

[SamuelTheThird]

But I was assured by people here the Strait would be a minor difficulty

https://www.investing.com/news/economy-news/iraq-oil-output-plunges-about-60-as-iran-war-blocks-tankers-bloomberg-reports-4548593

Iraq’s oil production has dropped by roughly 60% as the ongoing Iran war disrupts tanker availability and effectively blocks exports through the Strait of Hormuz, Bloomberg reported on Monday, citing people familiar with the matter.

According to the report, Iraq is currently producing about 1.7 million to 1.8 million barrels per day, down sharply from around 4.3 million barrels per day before the conflict began.

The decline reflects the growing logistical bottleneck in the Persian Gulf, where the war has sharply reduced the number of tankers able to load crude. With fewer vessels available to transport oil, regional producers have been forced to cut output as storage capacity fills up.

Iraq was the first major Gulf producer to reduce oil production because of the conflict, Bloomberg said. The United Arab Emirates and Kuwait have since followed with output cuts of their own as the disruption spreads across the region.

[Johonny]

1. Remember the 1970s gas lines?

Thanks Trump!

[Greg_In_SF]

3. With less than

10% of our oil coming from the middle east, there will be no gas lines or rationing.

[Melon]

5. I think it's less than 5% now. You are right. No shortage here of oil and gas. China and EU maybe hurt.

[Greg_In_SF]

6. And Canada

Looks like they get close to 60% of their oil from the middle east

[AZJonnie]

10. I think there could be gas lines and rationing unless the government takes regulatory steps to avoid them

Because as it stands now, there is no "our" oil apart from the strategic reserve (which is supposedly at 40 year lows per some recent DU post).

90% of what the US needs may come out of the ground on US soil, but the multi-national oil producing companies that extract it are free to sell to the highest bidders, who can be anywhere in the world.

That said, we're not near that point as of yet, but if this drags on 6 months, and the result is wide-spread damage to oil/LNG producing facilities, I would guess the government may have to take action to avoid literal shortages in the USA itself.

[displacedvermoter]

2. Lot of military strategists and tacticians

here abouts!

[Shermann]

4. We also have one running the country

Whatever happened to his idea about just taking the Iraqi oil??

[Boo1]

7. Wow, a lot of misunderstanding of how global oil trade works

There will be gas shortages because the places that got a lot of ME oil are instead going to be looking to buy it from non ME sources, and they will be willing to spend for it.

Just because we produce oil here doesn't mean that it's all going to go here. And what does go here certainly isn't going to go here cheaper than they can sell it there.

You can't cut off that much global supply and expect that it isn't going to impact everyone.


OH....and what happens if while this is dragging on a major hurricane were to cut through the gulf and hit Houston? That NEVER happens, right?

[SamuelTheThird]

8. Precisely

[cachukis]

9. The free market.

If they can sell it for $100.00 a barrel, they will.
We will, in essence, pay that here, or won't get the gas. The price will reflect the world market.

[Boo1]

11. And all those ships sitting in

the Persian Gulf are going to keep sitting there, sith or without escorts and insurance....

Because the $100 million worth of oil they filled it with because $200 million in oil if they just let it sit there.