MediumI Geo-Economics & Chokepoints3 October 2026, Saturday
Iraqi state tanker carries crude through Hormuz, a first in decades
The Iraqi Oil Tankers Company said on 3 October that it had carried 2 million barrels of Iraqi crude through the Strait of Hormuz on a very large crude carrier (VLCC). The company's director general described it as the first operation of its kind in decades.
According to Asharq Al-Awsat, director general Ali Qais Abdul Jabbar said the oil was carried beyond the strait on the company's own vessel instead of being handed to the buyer at Basra. The model gives the state oil marketer SOMO 2 kinds of flexibility: it can choose where to sell and when to lock in pricing. The director general said the company is seeking to buy new crude tankers to compete with regional shipping firms. According to the report, Iraq had earlier secured permission for its tankers to transit from Iran, which has effectively closed the strait in its conflict with the US.
Iraq's Oil Ministry said crude exports averaged 2.6 million barrels a day in September. According to Iraqi News, the ministry said a circulating figure of 4 million barrels reflected a single day's loadings, inflated by a shipment of Qayyarah heavy crude loaded outside the strait. ABC News on 4 October also reported the 2 million barrel transit as the company's first such operation in decades.
The route choice runs against the regional trend. According to Kpler data cited by Gulf News on 2 October, about 40% of the region's crude now bypasses Hormuz, against 17% before the war. Iraq, by contrast, keeps most of its exports dependent on the strait, and ties the transit to its own flagged ships with Iranian permission.
Talay assessment
Bottom line
While about 40% of the region's crude bypasses Hormuz, Iraq is trying to secure passage through the strait with its own ships and Iranian permission. In effect, the state is taking on shipping risk at a time when war risk insurance deters foreign owners. If the model works, Iraq can sell more barrels through the strait; but the transit stays fragile while it depends on Iran's consent.
Likely effects
- Iraq's export flexibilityPositive1–6 months
Because SOMO can choose the delivery point with its own tanker, it preserves sales capacity while buyers shy away from loading at Basra because of the war risk premium.
- Iran's leverage over the straitNegative1–6 months
Transit with Iranian permission shows Tehran using the strait as a bargaining tool by choosing which flags may pass.
- Tanker freightUncertainWeeks
State fleets carrying their own cargo modestly ease freight pressure while foreign tankers willing to operate inside Hormuz remain scarce.
Possibilities, ranked
- 1Voyages become routine50%
The company continues similar VLCC voyages and Iraq's exports through the strait rise above the September average.
Watch: The Iraqi Oil Ministry's October export average and new voyage announcements
- 2A one-off35%
Insurance, vessel numbers or security keep the operation rare, and exports stay around 2.6 million barrels a day.
Watch: No new Iraqi state tanker transit announced during October
- 3Transit permission suspended15%
Iran or the US blockade halts the passage of Iraqi tankers.
Watch: A change in Iran's stated permission for Iraqi-flagged vessels
Probabilities are calibrated judgement based on the sources, not measurement, and are revised as new information arrives. Not investment advice.
Market reaction
Indicators affected
- Iraqi crude carried through Hormuz▲ 2m barrels
- Iraq's September export average▲ 2.6m b/d
- Regional crude bypassing Hormuz▼ ≈40%
Sources
- Asharq Al-Awsat — Iraq Says It Transported 2 Million Barrels of Crude Through Strait of Hormuz
- Arab News — Iraq says it transported 2 million barrels of crude through Strait of Hormuz
- Iraqi News — Iraq Oil Ministry clarifies September crude exports average 2.6M bpd
- Gulf News — Iran's oil lifeline is choking while Gulf rivals restore the flow