Photo: bloomberg.com
Russian oil company Lukoil has declared force majeure at its Iraqi oil field, West Qurna-2, one of the largest oil fields in the world, after U.S. sanctions complicated its operations, Reuters reports.
Last month, the U.S. and the U.K. imposed sanctions on Lukoil, Russia's second-largest oil company. Following this, Iraq reportedly suspended all payments and oil deliveries to the company, according to three sources cited by Reuters.
Lukoil also sent a letter to Iraq's Ministry of Oil last week, stating that force majeure circumstances are preventing normal operations at West Qurna-2. A senior Iraqi oil official warned that if the situation is not resolved within six months, the company may cease production and completely exit the project.
West Qurna-2, located 65 kilometers northwest of the southern port of Basra, accounts for roughly 9% of Iraq's total oil output, with current production around 480,000 barrels per day. The field is considered Lukoil’s most valuable foreign asset.
On October 23, the U.S. Treasury imposed sanctions on major Russian oil companies, Rosneft and Lukoil, citing Russia’s lack of serious willingness to engage in a peace process to end the war in Ukraine.
