---
title: "$60 Billion for Independence: Iraq and the US Launch a New Oil Corridor Bypassing the Strait of Hormuz"
description: "Iraq and the US have signed a package of agreements worth $60 billion to create a new oil corridor through Syria. This will allow Baghdad to export oil by bypassing the blocked Strait of Hormuz. Chevron will act as the main contractor."
date: 2026-07-18T11:17:14.000Z
lang: en
url: https://xab.info/en/posts/iraq-and-us-launch-new-oil-corridor-bypassing-strait-of-hormuz
tags: [iraq, usa, chevron, al-zaedi, oil-export]
publisher: "XAB.info"
---

# $60 Billion for Independence: Iraq and the US Launch a New Oil Corridor Bypassing the Strait of Hormuz

![Workers at an Iraqi oil facility handle Mobil barrels against gas flares — symbolizing the new US-Iraq oil corridor bypassing the Strait of Hormuz](https://xab.info/media/2026/07/18/irak-i-ssha-sozdayut-nefteprovod-v-obhod-ormuzskogo-proliva/irak-i-ssha-sozdayut-nefteprovod-v-obhod-ormuzskogo-proliva-1.webp)

A visit by Iraqi Prime Minister Ali al-Zaidi to Washington has concluded, marking a turning point in regional energy policy. Baghdad and Washington have agreed on a massive package of agreements and memoranda of understanding with leading Western corporations totaling over $60 billion. The main goal of this deal is not just infrastructure modernization, but the strategic diversification of export routes, allowing Iraq to access global markets by bypassing the blocked Strait of Hormuz.

A key element of the agreements is the revival of the historical project to restore the cross-border oil pipeline connecting Iraqi fields to the Syrian port of Baniyas on the Mediterranean coast. The project, given the working title "Vital Energy Corridor," aims to create a stable land bridge for oil exports.

### Technical Architecture and Key Players

The plan involves a deep reconstruction and factual replacement of the infrastructure of the historical Kirkuk–Baniyas (Haditha–Baniyas) oil pipeline, which has not been operational since 2003. According to the agreements reached, the project will be led by an international consortium headed by the American corporation Chevron. The initial design capacity of the updated main line is planned at up to 2 million barrels of crude oil per day.

In addition to pipeline construction, the American giant is preparing to sign commercial agreements for the development of major Iraqi fields "West Qurna-2" and "Nasiriyah." Simultaneously, assets in the north of the country are being redistributed: American ConocoPhillips is acquiring a 42% stake in BP Energy of Kirkuk Ltd, joining British BP to intensify production at four active fields in the Kirkuk area.

[](/en/images/iraq-and-us-launch-new-oil-corridor-bypassing-strait-of-hormuz-2)

### Economic Necessity and Geopolitical Context

The initiative to urgently seek alternative routes for transporting raw materials is driven by the escalation of the military-political situation in the Persian Gulf region. Since late February 2026, shipping through the Strait of Hormuz has been effectively blocked. Prior to the crisis, about 20% of the world's hydrocarbon volumes were transported through this narrow strait.

For Iraq, the situation is critical: up to 95% of the total volume of hydrocarbon exports has traditionally been routed through southern sea terminals. In the conditions of a logistical crisis, the country was forced to significantly reduce domestic production, creating direct risks for fulfilling the revenue part of the state budget. Revenues from hydrocarbon sales account for up to 90% of national budget receipts, so creating a Mediterranean corridor became a matter of economic security.

Official Washington supported the initiative of Baghdad and Damascus. The US Department of State characterized the project as a priority infrastructure object of regional significance, contributing to the stabilization of the global energy market. According to estimates by relevant specialists, the full restoration of the corridor, which is about 800 kilometers long, will require the construction of new pumping stations and power supply systems, which will take from two to three years.