Lukoil Declares Force Majeure at Iraq’s West Qurna-2 After Western Sanctions

Lukoil has officially declared force majeure at Iraq’s West Qurna-2 oilfield following the imposition of US and UK sanctions, Orda.kz reports, citing Reuters. 

According to the agency, citing several industry sources, the Russian company sent a letter on November 4 to Iraq’s Ministry of Oil, explaining that sanctions had made it impossible to continue normal operations. After the restrictions took effect, Iraqi authorities suspended all financial transactions and crude-oil payments to Lukoil, the sources said.

A senior Iraqi oil official told Reuters that if the current situation isn’t resolved within six months, the company may cease production and withdraw entirely from the project.

Last week, Reuters also reported that Iraq’s state-owned SOMO canceled three planned crude shipments from West Qurna-2 because of the new sanctions.