Wednesday's drone strike on the Sarsang oil field in Kurdistan Region’s Duhok province - the latest in a series of attacks on energy infrastructure across Iraq and the Region - has accelerated what is now a near-total collapse of the Region's oil output. International oil companies have suspended operations, evacuated staff, and shut down fields, reducing combined Iraq and Kurdistan’s exports to barely a tenth of pre-war levels.
One month into the US-Israel war with Iran, the impact on global oil and gas markets has been severe. Iraq and the Kurdistan Region - whose economies rely heavily on oil revenues - have seen combined output drop by around 3.2 million barrels per day. From roughly 4.5 million bpd before the conflict, only about 400,000 barrels per day are now reaching export markets.
Before the war
Prior to the conflict, Iraq and the Kurdistan Region were producing a combined 4.5 million barrels of oil per day, including 314,000 barrels from fields in the Kurdistan Region. Total daily exports stood at 3.57 million barrels, of which 198,000 barrels came from the Kurdistan Region, according to February 2026 figures.
Now
Combined production has fallen to 1,332,000 barrels per day, with just 80,000 barrels coming from fields in the Kurdistan Region. That marks an overall decline of 3.2 million barrels per day, including a drop of around 250,000 barrels from the Kurdistan Region alone.
Causes behind the collapse
Iraq’s federal oil output has fallen due to three key factors: the closure of the Strait of Hormuz, insufficient national storage capacity, and the withdrawal of international joint venture partners. Foreign companies work alongside Iraqi firms at 41 of the country’s 67 oil and gas fields, with most production concentrated in southern Basra province, which is now largely cut off from export routes.
In the Kurdistan Region, the situation is even more severe. Production has dropped by over 70 percent, largely due to international companies suspending operations and evacuating staff from the very start of the conflict. Security conditions have worsened since. The Sarsang oilfield - operated by HKN Energy in partnership with Shamaran Petroleum and the Kurdistan Regional Government (KRG) - has been struck by drones twice, causing significant damage to its storage facilities. These attacks have further discouraged international operators from resuming production, with no restart expected as long as the threat of additional strikes persists.
Blocked export routes, full storage facilities, and a security environment too dangerous for international companies have effectively brought Kurdistan’s oil sector to a standstill for the duration of the conflict.
Top 10 Iraq oil fields by production before the war
Mahmood Baban is a research fellow at the Rudaw Research Center.
The views expressed in this article are those of the authors and do not necessarily reflect the position of Rudaw.