Iraq is in talks to acquire two floating regasification terminals as part of its efforts to reduce reliance on Iranian gas. This move comes amid a renewed push by the U.S. to impose stricter sanctions on Iran.
According to Bloomberg, the Iraqi government aims to meet up to 50% of its peak domestic gas demand with the terminals, with the remainder to be supplied by local gas production. The terminals are planned to be located at the port of Basra, as confirmed by Iraq’s Oil Minister, Hayyan Abdul Ghani.
Currently, Iran is Iraq’s primary supplier of both gas and electricity. However, earlier this month, the U.S. refused to renew a sanctions waiver that allowed Iraq to continue purchasing Iranian electricity. With the waiver expired, there is growing pressure on Iraqi oil field operators to reduce gas flaring and use more of the gas for power generation.
In early February, President Trump reinstated the “maximum pressure” campaign on Iran through a National Security Presidential Memorandum. The objective is to resume negotiations on a new nuclear deal.
The memorandum directs the U.S. Secretary of State to adjust or revoke sanctions waivers, particularly those offering Iran economic or financial relief, including those related to Iran’s Chabahar port project. It also calls for a sustained effort to reduce Iran’s oil exports to zero, including shipments to China.
The “maximum pressure” campaign was not unexpected, as President Trump had previously announced his intention to pursue this strategy. Iran, however, has warned that these measures could destabilize the global oil market and negatively affect consumers.
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