Chevron returns to Iraq
Chevron and Iraq's Basra Oil Company signed preliminary agreements on Sunday to transfer management of the West Qurna 2 oilfield from Russia's sanctioned Lukoil. Prime Minister Mohammed Shia Al-Sudani presided over the Baghdad ceremony, with US special envoy Tom Barrack also in attendance.
West Qurna 2 holds an estimated 14 billion barrels of recoverable reserves and pumps around 400,000 barrels per day, making it one of the biggest producing fields in the world. Lukoil owned a 75% equity stake before US sanctions forced the Russian company to declare force majeure in November.
A three-way handover
The deal works through a framework agreement between Basra Oil Company, Lukoil, and Chevron. The operating contract moves temporarily to Basra Oil before being reassigned to Chevron once both sides agree on new terms. Chevron has exclusive negotiation rights for one year.
Final approval rests with Iraq's Council of Ministers and the US Treasury's Office of Foreign Assets Control.
Iraq had already stepped in through Basra Oil in January to keep output running after Lukoil walked away. The Russian company announced in October 2025 that it would sell all its international holdings, and in January it agreed to offload most of them to private equity firm Carlyle.
More fields on the table
Chevron did not stop at West Qurna 2. The company also signed agreements with Dhi Qar Oil Company and North Oil Company covering the Nasiriyah oilfield, four exploration blocks in Dhi Qar province, and the Balad field in Salahaddin province.
Together, the deals mark the biggest return of a US oil major to Iraqi operations in years. Washington sanctioned Lukoil over Russia's refusal to engage seriously in peace talks on Ukraine, and the resulting fire sale of Russian assets has opened doors for Western operators across Iraq's southern fields.
What it means for the market
Iraq pumps roughly 4.4 million barrels per day, and West Qurna 2 alone accounts for nearly a tenth of that total. Keeping the field online without a hitch is a top priority for Baghdad.
Brent crude traded at $70.80 per barrel on Monday while WTI sat at $65.90. Both benchmarks eased after last week's geopolitics-driven rally, though analysts say an Iran-related risk premium still supports prices.
For Chevron, West Qurna 2 offers a foothold in some of the cheapest barrels on earth. The question now is whether it can close a final deal within the one-year exclusivity window — and how much Baghdad will demand in return.