Iraq's oil production plummets by 80%, forcing multiple countries' oil companies to cut output.

Due to the ongoing conflict in the Middle East and the obstruction of crude oil export routes through the Strait of Hormuz, Iraq's domestic crude oil storage tank inventory has reached critically high levels. As the second-largest oil producer in OPEC, the country's core southern oil fields have experienced a significant decline in production.

Iraqi energy officials revealed that the current daily production from major southern oil fields has dropped to 800,000 barrels, a sharp reduction of approximately 80% compared to the pre-conflict level of 4.3 million barrels per day. Earlier this month, due to export disruptions, production in the region had fallen to 1.3 million barrels per day, a decline of about 70%.

To address the pressure of saturated storage tanks, Iraq implemented a new round of production cuts starting March 24 and issued formal reduction directives to foreign oil companies:

· Requiring BP to reduce daily production at the Rumaila oil field from 450,000 barrels to 350,000 barrels, a cut of 100,000 barrels;

· Requiring Eni to reduce daily production at the Zubair oil field from 330,000 barrels to 260,000 barrels, a cut of 70,000 barrels;

· Simultaneously scaling down production at multiple state-owned oil fields.

In an official letter to BP, Iraq's state-owned Basra Oil Company explicitly stated that, due to storage tank inventory reaching critical levels, the production cut at the Rumaila oil field would be enforced starting at 09:00 local time on March 24.

Energy officials warned that if the Strait of Hormuz crisis persists, Iraq may announce further production cuts in the coming days.

Although Iraq recently reached an agreement with Kurdish authorities to restart the Kirkuk-Ceyhan pipeline and resume crude oil exports via Turkey's Ceyhan Port, the supply capacity of this route is limited. It is insufficient to alleviate the global supply gap and cannot change the reality of forced significant production cuts at southern oil fields.