Iraq in negotiations with German firm to secure safe passage via Hormuz

Baghdad (IraqiNews.com) – Iraq’s State Oil Marketing Organization (SOMO) is in serious discussions with a German shipping firm to secure safe passage for crude oil exports through the Strait of Hormuz on Iraqi-flagged tankers, leveraging an initial arrangement with Iran to avoid regional shipping restrictions in the waterway.

According to local news outlet Shafaq News, Baghdad requires all chartered transit vessels to fly the Iraqi flag.

While an American firm rejected this term, the German shipping company accepted the condition to transport crude from Iraq’s southern ports.

Tehran has agreed in principle to waive transit costs for Iraqi-flagged vessels passing through the Strait of Hormuz.

Haibat al-Halbousi, Iraq’s parliament speaker, met with Iranian authorities to request special treatment to protect Iraq’s economic interests.

Iraq still requires explicit US authority or sanctions clearance to complete the agreement. The step is necessary due to the United States’ stringent restrictions on shipping, insurance, and transit systems associated with Iranian territorial waters.

This agreement is part of a bigger drive by Iraqi Prime Minister Ali al-Zaidi’s cabinet, which recently approved an emergency three-month mechanism to diversify export routes through specialized local and foreign enterprises beginning September 1.

The Iraqi government approved oil purchases at a lower price compared to the official rate of SOMO with an annual 30 percent discount.