New Delhi, July 17 -- WASHINGTON - For Ali al-Zaidi, Iraq's prime minister, the numbers in his government's budget tell a story familiar to any finance minister dependent on a single export route. Iraqi oil shipments collapsed from 4.2 million barrels per day in February to 1.45 million in May, a 60 percent drop triggered by the US-Iran conflict that effectively sealed the Strait of Hormuz. Every week that crude stays landlocked costs Baghdad hundreds of millions of dollars.

The answer, Washington has decided, runs through Syria.

Thomas Barrack, the US special envoy to Syria and Iraq, has been convening meetings with officials from both governments and American energy companies, including Chevron, about reviving the Kirkuk-Baniyas pipel...