After years of withdrawal or retreat due to political and security risks, major oil firms have begun signaling a gradual re‑entry into the Iraqi and Libyan markets. The steps come as both countries seek to boost oil production and attract fresh international investment in the energy sector.
Iraq: Back to giant fields
ExxonMobil is pursuing the acquisition of Lukoil’s stake in the West Qurna 2 oilfield, one of the largest in the world and responsible for around 9% of Iraq’s output. The company has also signed a preliminary agreement to develop the Majnoon oilfield in southern Iraq, reflecting Baghdad’s push to entice global firms with improved investment terms to revive stalled or neglected projects.
Libya: Renewed interest in exploration
In Libya, BP and Shell have revisited the market after years of instability, signing memoranda of understanding with the National Oil Corporation to study exploration potential in offshore and onshore fields. ExxonMobil has also signed an MoU to conduct technical studies on four offshore blocks off the northwest coast and in the Sirte Basin, signaling a reshaping of its investment map in the country.
Drivers and challenges
These moves are driven by improved investment conditions, production‑sharing contracts, and sustained global demand for oil and gas amid slowing investment in renewables. Both Baghdad and Tripoli are seeking to strengthen state revenues and achieve sustainable economic growth by reactivating their energy sectors.
Despite the positive signals, investors still face political and security challenges in both countries, requiring cautious risk management. Even so, the steps mark a strong return of confidence among international energy companies, with the prospect of gradual expansion in oil and gas projects in the near future.
