Russian oil producer Lukoil has declared force majeure at Iraq’s West Qurna 2 oilfield following the imposition of US sanctions that have disrupted its operations, Reuters reported.

The company informed Iraq’s Ministry of Oil last week that the sanctions had created conditions preventing it from maintaining normal operations at the field, according to four unnamed sources cited by the news agency.

Last month, the United States imposed sanctions on Lukoil and gave companies and banks until 21 November to end all dealings with the Russian company and its subsidiaries.

Lukoil operates the West Qurna 2 field under a service contract that grants it a share of oil production for sale on international markets. The company also receives payments in US dollars for managing the field — transactions that would be restricted under the US sanctions.

Despite successive rounds of international sanctions against Russia since its February 2022 invasion of Ukraine, Lukoil in 2023 extended the West Qurna 2 contract by 10 years to 2045, with plans to increase production to 800,000 barrels per day.

Source: Reuters