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OIL & GAS 360 INTERVIEW WITH CHRISTOPHER HILL, FORMER U.S. AMBASSADOR TO IRAQ
The Unique Problem of Iran Conflict in the Middle East increases when the U.S. killed major general Qasem Soleimani early this year. Christopher Hill explains what this means for the oil and gas industry.
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CHRISTOPHER HILL, FORMER U.S. AMBASSADOR TO IRAQ
ising tension between the United
produced 2.1 MMBOEPD, according to secondary
States and Iran caused concern
sources reported in OPEC’s monthly report.
for oil supply and transportation when the U.S. killed Iranian major
Along with concerns that kinetic conflict might stop
general Qasem Soleimani on
production at the wellhead, Iran has frequently
January 3, 2020 in a drone strike
threatened to prevent transportation of crude through
in Iraq. In retaliation, Iran launched numerous ballistic
the Strait of Hormuz, a narrow strait approximately a fifth
missiles at targets inside Iraq including the Ain al-Assad
of the world’s oil shipments pass through.
airbase which houses U.S. troops. Protests continue in Baghdad this week and more rocket strikes have been reported in the city’s Green Zone, the heavily fortified area of the capital that houses the U.S. Embassy.
With a significant portion of global production and such an essential logistics chokepoint all being threatened by the possibility of a military conflict, Iran continues to be a major focal point for global oil markets and for U.S. policy. “I think there’s an interest in the Trump administration to calm this down,” explained Ambassador Christopher Hill, former U.S. Ambassador to Iraq, and Chief Global Advisor and Professor of the Practice in Diplomacy at the University of Denver. “Iran has shown some restraint in that they have not killed any U.S. soldiers,” continued Hill, referencing that troops at al-Assad were warned in advance of the missile strike, “the president – any president – would have to go with Iran if we saw a successful attack against U.S. troops.” Conflict in the Middle East is complicated and runs
Brent and WTI crude oil prices. Yellow line marks Jan. 3, 2020, the date Qasem Soleimani was killed by a U.S. drone strike in Iraq
deep. The assassination of Soleimani was a strain on the delicate balance in the region. “It’s important to understand that this was not some stateless guy living
The initial escalation of force sent oil prices to multimonth highs of $68.91 and $63.27 for Brent and WTI
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in a cave. Soleimani was a general in the Iranian military and had quite a large following in Iran,” said Hill.
crude grades, respectively, on January 6, 2020. A hot
“In the view of many in the American military, Soleimani
conflict in the Middle East could quickly disrupt oil
was responsible for the death of thousands of U.S.
production in some of the largest producing countries
soldiers through his actions backing Shia militias in
in the world. Iraq accounted for 4.6 MMBOPD of crude
Iraq,” continued Hill. “I was in Iraq in June 2009 and an
production in the fourth quarter of 2019 while Iran
Iranian-funded Shia militia tried to kill me. Fortunately,
