<span>STORY: Iraq has declared force majeure on all oilfields developed by foreign oil companies according to three energy officials with direct knowledge of the decision.</span><span>It comes after military operations in the region disrupted navigation through the Strait of Hormuz, halting most of the country’s crude exports.</span><span>About 20% of global oil and liquefied natural gas supplies travel through the strait.</span><span>‘Force majeure’ is used to describe events outside a company’s control, such as a natural disaster, which usually releases it from contractual obligation without penalty.</span><span>Iraq’s oil ministry ordered a full shutdown of production at affected areas, with no compensation arising from the measure under contract terms according to a letter dated March 17th that was seen by Reuters.</span><span>International oil prices settled at their highest level in nearly four years on Friday, as the three-week-old U.S.-Israeli war with Iran escalated.</span><span>The ministry said it would review the situation periodically and invited companies to urgent talks to agree on essential operations, costs and staffing under the force majeure conditions.</span><span>The drop in production and exports is set to strain Iraq’s already fragile finances as the state relies on crude sales for nearly all public spending and more than 90% of its income.</span>
