DECEMBER 9, 2022
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China Strengthens Hold on Iraq's Oil as U.S. Influence Wanes

China Strengthens Hold on Iraq's Oil as U.S. Influence Wanes

Iraq’s oil ministry announced on Saturday that five Chinese companies have won bids to explore the country’s vast oil and gas fields, marking another step in China's growing influence in the Middle East. Not a single American firm secured a contract, despite recent meetings between the Iraqi government and U.S. companies about potential deals.

European, Arab, and Kurdish firms also succeeded in securing some of the 29 available projects, further diversifying the field of contractors.

Following the 2003 Iraq war, U.S. companies initially had significant traction in Iraq’s oil sector. However, since China signed its first post-invasion contract with Iraq in 2009, it has steadily become a dominant player. Iraq is now China’s third-largest source of oil, underscoring Beijing's strategic success in the region. In contrast, U.S. influence has waned, highlighted by ExxonMobil’s recent exit from Iraq after the China National Petroleum Corporation was granted lead contractor rights over one of Iraq’s largest oil fields.

This shift underscores Iraq’s reluctance to become entangled in the geopolitical conflict between the U.S. and Iran, while also reflecting China’s successful strategy of securing influence through substantial investment and development projects in the Middle East.

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