EditCan Germany turn Iraqi oil ambitions into a lasting European supply corridor?
Berlin talks yield energy deals while Baghdad looks to Mediterranean routes and higher production targets
Iraqi Prime Minister Ali al-Zaidi announced Tuesday that Baghdad is actively negotiating the sale of crude oil to European markets following meetings in Paris and Berlin, as the country moves to reduce its heavy dependence on the Strait of Hormuz amid ongoing regional conflict.
Speaking at a joint press conference with German Chancellor Friedrich Merz, Zaidi said Iraq can no longer remain “hostage to a single corridor” and is pursuing expanded export routes through the Mediterranean that could supply Europe and the United States.
The statement marks a clear shift in Iraqi energy strategy. Crude oil sales generate nearly 90 percent of the country’s revenue. Before the Iran war erupted in February, Iraq produced around four million barrels per day and exported an average of 3.4 million barrels daily, the vast majority of it moving through the Strait of Hormuz to buyers in East Asia, principally China and India. Iranian actions that restricted the waterway, combined with related disruptions, have forced Baghdad to rely on limited alternatives: tanker trucks moving oil through Syria and the existing pipeline to Turkey’s Mediterranean port of Ceyhan. Those land and pipeline routes can handle only a fraction of Iraq’s normal seaborne volumes, leaving the economy exposed.
Zaidi told reporters that he raised the prospect of direct oil sales to Europe during his meeting with French President Emmanuel Macron in Paris on Monday and again with Merz in Berlin. He said Iraq aims to “double its oil exports through the Mediterranean” and eventually direct a large share – nearly half, of its production toward European and Western markets. The prime minister has set an ambitious long-term production target of nine to ten million barrels per day. Under that scenario, he argued, a substantial portion could flow westward once additional capacity is developed.
Central to the Berlin discussions was a prospective understanding under which Iraq would export crude to Germany in exchange for German technology and equipment. Merz confirmed that economic cooperation, particularly in the energy sector, forms the core of the bilateral relationship. German companies are already active in Iraq, he noted, developing solutions for energy supply. The two sides planned to formalize an agreement on electricity generation during the visit. That memorandum involves the Iraqi Ministry of Electricity and Siemens Energy and covers the fourth phase of Iraq’s Energy Agenda. The program envisions new power plants with a combined capacity of 14,000 megawatts that will use local fuel and combined-cycle technology to improve efficiency and reduce the need for fuel imports.
Iraq’s electricity grid remains under severe strain. Daily shortfalls exceed 35,000 megawatts, while peak summer demand reaches 55,000 to 60,000 megawatts against constrained supply. Zaidi described the emerging partnership as an “economic bridge” rather than a one-sided arrangement. “Iraq possesses abundant resources and a workforce but requires technology and expertise,” he said. During the visit he also met Siemens Energy chief executive Christian Bruch to discuss expanding cooperation on power distribution networks and diversified generation sources.
Diversification plans center on Mediterranean outlets
Iraq’s immediate technical focus is increasing the capacity of existing northern export routes. Officials plan to bring to the Ceyhan pipeline terminal up to 1.25 million barrels per day. An initial stage would move an additional one million barrels toward Syrian outlets, followed by further stages that would ultimately deliver oil to European markets. Zaidi stressed that these steps are essential because the country cannot continue to depend on a single maritime chokepoint whose vulnerability has been demonstrated by recent events. The broader goal is to create parallel pathways that give Baghdad greater flexibility in responding to geopolitical shocks.
Merz placed the energy talks in a wider regional context. He expressed concern over the consolidation of Houthi control around the Bab al-Mandab Strait at the entrance to the Red Sea, a critical passage for Saudi and other regional oil exports. The chancellor said the situation further tightens global energy markets and affects Germany directly. He called for coordinated international efforts, including consultations with European Union partners and regional states such as Iraq, to prevent the Houthis from holding Red Sea shipping “hostage.” On Iran, Merz demanded an end to the Hormuz blockade, a halt to Tehran’s military nuclear program, and an end to support for proxy forces that risk drawing Iraq into wider conflict.
Security and governance remain linked to economic ambitions
Beyond energy, the two leaders discussed Iraq’s internal security and governance. Merz praised the militia disarmament process initiated by Zaidi’s government and urged the prime minister to continue it resolutely. He offered continued security cooperation should Baghdad request it. Zaidi responded that Iraqi security forces are now capable of maintaining control of the country’s territory independently. “If we need them, Germany and the coalition nations will not be far away. However, we are the ones in control of the situation and are capable of protecting our country,” he said, insisting that weapons must remain under state authority and that decisions of war and peace belong exclusively to state institutions.
Merz also recalled Germany’s long involvement in Iraq’s stabilization since 2004, noting the defeat of the Islamic State’s territorial caliphate, the return of millions of internally displaced people, and ongoing support for communities such as the Yazidis. He linked a stronger German and European economic presence in Iraq to progress against corruption and the development of a more transparent administration operating under the rule of law. Zaidi’s government, he said, has taken important first steps in that direction. The chancellor further emphasized the importance of constructive relations between Baghdad and the Kurdistan region in northern Iraq.
The Berlin visit formed the second leg of Zaidi’s first European tour as prime minister. In addition to the formal talks and the Siemens meeting, he participated in a German-Iraqi business forum where he outlined investment opportunities across energy, oil and petrochemicals, phosphates, clean energy, and pharmaceuticals. The overall message from both sides was that closer economic ties, anchored in oil exports and electricity infrastructure, can serve mutual interests while giving Iraq greater resilience against regional instability.
Sources: FocusEurope.pl, Al Arabiya, AFP, The New Region
Caption: Iraq’s Minister of Electricity Ali Saad Wahib (L) and Siemens Energy CEO Christian Bruch (2-R) sign a memorandum of understanding as Iraq’s Prime Minister Ali Falih al-Zaidi (2-L) and German Chancellor Friedrich Merz (R) look on at the Chancellery in Berlin, Germany, 15 September 2026. EPA/FILIP SINGER
Updated: September 16, 2026 - 13:43
