Following the crushing sanctions imposed by Washington against Russia’s second-largest oil producer, Lukoil, the latter seems to be bracing to quit Iraq’s southern West Qurna 2 oilfield.
According to Zawya Projects, in October 2025, the energy major accepted an offer from Switzerland-based commodity trader Gunvor Group to buy its international subsidiary.
Lukoil, which has come under Uncle Sam’s hammer as the Donald Trump administration eyes punishing Moscow for its Ukraine invasion, participates in projects in Iraq, Azerbaijan, Kazakhstan, Uzbekistan, Egypt, Cameroon, Nigeria, Ghana, Mexico, the UAE and the Republic of the Congo.
Lukoil holds a 75% stake in the West Qurna 2 oilfield, while the rest is controlled by the state-owned South Oil Company. Reacting to the latest development, an Iraqi official told the Aliqtisad news, “Should Lukoil quit the field and production be halted, this will deprive Iraq’s crude oil exports from 450,000-500,000 bpd.”
A well-known Iraqi analyst close to the government said reports that Lukoil has declared force majeure in its operations in south Iraq show that the Western sanctions are working and that such a declaration is a “big geopolitical triumph” for the US-led bloc against Moscow.
“I believe Lukoil’s move will open new opportunities for such Western companies as ExxonMobil, BP and TotalEnergies to bolster their presence in Iraq. The road now appears clear for any arrangement between Iraq and Western companies, which are gradually returning to Iraq…I see a good chance for ExxonMobil in West Qurna 2 given its long experience in the nearby West Qurna 1,” said Nabil Al-Marsouimi, an author of several books on Iraq’s energy sector and economy, while interacting with the Zawya Projects.
In early 2024, ExxonMobil quit West Qurna 1 and handed its operations to PetroChina as the lead contractor as part of a plan to phase out its presence in Iraq for security and contractual reasons, including unattractive project terms offered by Baghdad. The American company is set to return to Iraq after it signed a head of agreement (HOA) with Baghdad in October 2025 for the development of the southern Majnoon oilfield, one of the world’s largest single crude reservoirs.
“Iraq needs to find a new foreign partner in West Qurna 2 because Lukoil’s stake is too large for the government to afford,” said Walid Khaddouri, an Iraqi energy expert and former information chief at the Organisation of Arab Petroleum Exporting Countries (OAPEC).
As per Reuters, ExxonMobil is studying a potential bid for West Qurna 2, while Iraqi sources, quoted by Al-Iqtisad news, said they expected Chinese companies to join the race for that field given their strong presence in the country after they won most of the contracts awarded within Iraq’s oil concession licensing rounds in 2024.
The sources reportedly believed that PetroChina is a strong candidate to take over Lukoil’s operations in West Qurna 2 since it operates the nearby Qurna 1. Iraq, however, has expressed its anger over Lukoil’s decision to declare force majeure in its Qurna operations, describing the move “illegal.”
“The declaration is against the law because it is unilateral…the Iraqi oil ministry has not made a similar declaration, although it is party to the agreement with Lukoil. An Iraqi oil company could handle production at Qurna field in case of Lukoil withdrawal for now…another solution is that the field could be handed over to one of the foreign companies already operating in Iraq,” said Ali Al-Shatri, director general of the state oil marketing organisation (SOMO).