Lukoil has declared force majeure at its West Qurna-2 oil field in Iraq, a significant consequence of U.S. sanctions impacting Russian oil companies. This move highlights the strain Lukoil faces as it operates internationally amid escalating geopolitical tensions. The company informed Iraq’s oil ministry that it could not maintain normal operations due to these conditions, marking a critical juncture for Lukoil, which is heavily exposed to global markets.
West Qurna-2, located near Basra, is one of the largest oilfields globally, contributing approximately 9% of Iraq’s oil output and producing around 480,000 barrels per day. If the issues leading to the force majeure are not resolved within six months, Lukoil may cease production and exit the project entirely. Meanwhile, Iraq’s state oil firm SOMO has halted all payments to Lukoil, complicating the company’s financial situation further.
In a separate development, Bulgaria is preparing to seize control of Lukoil’s Burgas refinery, with Prime Minister Rosen Zhelyazkov stating that inspections and security measures are underway. Recent legal changes have enabled the Bulgarian government to take over the refinery and potentially sell it to a new owner, underscoring the challenges Lukoil faces in maintaining its assets abroad.
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