Iraq and Pakistan Sign Transit Agreements with Iran

Iraq and Pakistan have struck separate deals with Iran to ship oil and liquefied natural gas through the Strait of Hormuz, demonstrating Tehran's ability to control energy flows even as overall traffic has collapsed. -Israeli war with Iran has slashed energy exports from a region that normally supplies 20% of the world's crude oil and LNG. U.S.

Has blockaded Iranian ports in recent weeks as of May 12, 2026. Iraq secured safe passage for two very large crude carriers, each carrying about 2 million barrels of crude, that passed through the Strait of Hormuz on May 10, 2026. Iraq is now working to secure Iran's approval for more transits, an Iraqi oil ministry official said.

Oil revenues make up 95% of Iraq's budget. Iran has asked Iraq to submit documentation for each tanker to facilitate transit via designated maritime routes under the supervision of its naval forces. Specialised teams at the Iraqi oil ministry are providing Iranian authorities with detailed information on individual vessels, including destination, shipping details, ownership and cargo specifications.

Neither Iraq nor Pakistan has made direct payments to Iran or its Islamic Revolutionary Guard Corps in relation to the transits. Two tankers loaded with Qatari LNG are headed to Pakistan following a bilateral agreement between Islamabad and Tehran. Pakistan received roughly 10 LNG cargoes a month before the war.

Qatar informed the United States ahead of the LNG shipments to Pakistan. Before the war, about 3,000 vessels passed through Hormuz each month. Traffic through the Strait of Hormuz is now around 5% of pre-war levels.

The disruption has sent Brent crude surging by more than 50% since the outbreak of the conflict at the end of February 2026. LNG prices in Europe and Asia have jumped by roughly 35% to 50%. Iran claims the Strait of Hormuz area extends from the port of Jask in the Gulf of Oman to the island of Siri in the Persian Gulf.