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Lukoil Declares Force Majeure at Iraq’s West Qurna-2 After U.S., U.K. Sanctions

A payment freeze in Iraq now starts a six‑month countdown that could force Lukoil to quit the project.

Overview

  • Iraq’s oil ministry says funds tied to West Qurna-2 will stay frozen until contract terms allow payments to non‑sanctioned entities.
  • SOMO canceled planned loadings from the field, including roughly 4 million barrels allocated to Lukoil for November.
  • Lukoil notified Baghdad on November 4 and is invoking force majeure to shield itself from contractual penalties.
  • Work by all non‑Russian foreign staff has been suspended, with Russian and Iraqi personnel maintaining output near 480,000 barrels per day.
  • Efforts to sell overseas assets have faltered after Gunvor withdrew its offer for Lukoil International GmbH following U.S. licensing warnings.