Iraq and Syria sign deal to rehabilitate Mediterranean pipeline, bypass Strait of Hormuz

What Happened

During the US-Iraq Business Council meeting in Washington, DC, Iraq and Syria signed a cooperation agreement to rehabilitate the Kirkuk-Baniyas oil pipeline. Bassem Abdul Karim Nasr, head of Iraq's Basra Oil Company, and Youssef Qablawi, CEO of the Syrian Petroleum Company, signed the deal, overseen by US Energy Secretary Chris Wright. The pipeline, originally built in 1952 with a capacity of 300,000 barrels per day, has been defunct since the 1980s and damaged after the 2003 US invasion. A US-led consortium comprising Chevron, Los Angeles-based TI Capital, and Syrian-Qatari billionaires al-Khayyat brothers will execute the reconstruction, which one regional official estimated would take two to three years and require wholesale replacement. Middle East Eye first revealed the US-brokered effort, with US ambassador Tom Barrack taking the lead; subsequent reporting by Bloomberg, Reuters, and others confirmed the deal. The US State Department called the project a "priority infrastructure project of bilateral and regional strategic significance."

Key Actors

Why It Matters

If completed, the pipeline would allow Iraqi oil to reach Mediterranean markets without transiting the Strait of Hormuz, a chokepoint where Iran has repeatedly threatened to disrupt traffic. This directly challenges Iran's geopolitical leverage and aligns with US "maximum pressure" strategy by economically distancing both Iraq and Syria from Tehran. The project also signals a rare US-backed infrastructure initiative in sanctions-hit Syria, potentially reshaping regional alliances and energy corridors.

Watch For

The pipeline's rehabilitation timeline of two to three years will require sustained security along its route through unstable Syrian territory. Iran may retaliate politically or through proxies, as the project undermines its strategic position. US sanctions on Syria could complicate implementation—watch for specific waivers or legal frameworks. Progress will depend on the consortium's technical assessments and any diplomatic friction between Baghdad, Damascus, and Tehran.