Chevron to explore Iraqi oil bypass of Strait of Hormuz with pipeline to Syria

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Chevron (CVX) will sign preliminary deals Friday to invest in two Iraqi oil fields and join a group of investors exploring the construction of a pipeline to connect Iraq's oil patch with the Syrian coast, as Iraq and other Middle East oil producers desperately seek alternatives to transiting the Strait of Hormuz, The Wall Street Journal reported Thursday.

The deals with Chevron (CVX) are part of a broader push by new Iraqi Prime Minister Zaidi to shore up investment from the U.S., and the U.S. Chamber of Commerce is scheduled to host a U.S.-Iraq Business Summit on Friday in Washington with Zaidi, U.S. Secretary of Energy Chris Wright, and others where $60B in deals will be signed, according to the report.

Zaidi met President Trump at the White House on Tuesday and visited Chevron's (CVX) headquarters in Houston on Thursday to meet company executives, where they reportedly discussed several options including rebuilding the pipeline from Kirkuk in northern Iraq to the Syrian port of Baniyas on the Mediterranean Sea that has been shut for more than 20 years.

Chevron (CVX) is also discussing investments in the giant 460K bbl/day West Qurna 2 oilfield and the smaller Nasiriyah oilfield; a few days before the U.S.-Iran war began, the company said it was entering exclusive talks with Iraq's state-run Basra Oil for a stake in West Qurna 2.

Iraq is the Middle East's second-biggest oil producer behind Saudi Arabia, pumping ~4.5M bbl/day in normal times, or 5% of the world's supply, but its exports have plunged during the U.S.-Iran war.

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