Lebanon has proposed serving as a Mediterranean transit corridor for Iraqi crude oil as both countries explore alternative export routes to reduce Iraq’s dependence on the Strait of Hormuz following disruptions caused by regional conflict.
The proposal was discussed during Lebanese Prime Minister Nawaf Salam’s visit to Baghdad, where officials from both governments focused on expanding economic cooperation, particularly in the energy sector.
According to Iraqi Prime Minister Ali Al Zaidi’s financial adviser, Mudhir Mohammed Salih, Lebanon offered to provide Iraq with an additional export outlet through the Mediterranean using Lebanese territory.
Salih said the proposal could strengthen Lebanon’s role as a regional logistics hub while giving Iraq broader access to international markets. He added that the closure of the Strait of Hormuz has created significant challenges for Iraq’s oil exports.
Iraq, the second-largest oil producer in OPEC, has experienced a sharp decline in crude exports since regional tensions escalated. OPEC data shows exports fell from approximately 4.2 million barrels per day in February to about 1.5 million barrels per day in May.
Lebanese Energy Minister Joe Saddi said discussions centered on transporting Iraqi crude and other energy products to Mediterranean markets through Syria, with Lebanon acting as a transit and processing center.
He described the talks as constructive, saying both governments agreed to establish a joint technical committee to evaluate the project’s feasibility. An Iraqi delegation is expected to visit Lebanon in the coming weeks to conduct technical assessments and identify practical steps for implementation.
Saddi said the discussions include rehabilitating or extending existing pipeline infrastructure, constructing a branch connecting Syria to the northern Lebanese port of Tripoli, and examining the possibility of building a refinery that could supply Lebanon’s domestic fuel market.
In the short term, he said Iraq could make use of existing oil storage facilities in Tripoli for exports, similar to arrangements already being used through Syria since regional conflict disrupted traditional shipping routes.
Officials said the project could generate transit revenue for Lebanon, increase activity at Tripoli’s export facilities, create new employment opportunities and improve domestic supplies of refined petroleum products.
Separately, Iraq is preparing to renew its agreement with Türkiye to continue crude exports through the Kirkuk-Ceyhan pipeline, while negotiations are also advancing to restore the long-idled Kirkuk-Baniyas pipeline linking Iraq with Syria.
A branch of that pipeline historically extended to Tripoli, where it supplied a refinery and export terminal.
Energy analyst Marc Ayoub cautioned that while the proposal has strategic value, restoring or expanding the necessary infrastructure would require extensive technical work and could take years before becoming operational.
The two sides also discussed outstanding payments related to Iraq’s heavy fuel oil supplies under a 2021 swap agreement. Iraqi officials said Lebanon still owes about $1.2 billion, with both governments continuing discussions on a mechanism to address the arrears.