Oil exports from Iraqi Kurdistan to Turkey to resume on Monday

After an interruption of several days, oil exports from Iraqi Kurdistan to Turkey will resume. An agreement has been reached between Baghdad and Erbil for the management of Kurdish crude oil.

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Iraqi Kurdistan will resume “in two days” its oil exports to Turkey, interrupted since last Saturday, after Baghdad and Erbil have agreed on the management of Kurdish crude, government sources said Saturday.

The oil issue has long poisoned relations between the authorities in Baghdad and those in Iraqi Kurdistan, an autonomous region in the north of the country. The two entities have indicated, however, to have reached an agreement, allowing a resumption “in two days” of oil exports from Iraqi Kurdistan to the Turkish port of Ceyhan, said an Iraqi government official to AFP on condition of anonymity. An Iraqi Kurdish official confirmed this information to AFP, while wishing to remain anonymous.

“Kurdistan’s oil sales will now go through (the Iraqi state oil company) Somo,” the Baghdad official said. That is, Erbil will no longer go it alone in the management of its oil, which has infuriated the federal government.

In addition, a “joint committee” formed by the two governments will monitor the “process of exporting oil from Kurdistan”.

Finally, the income earned will be paid into an account “monitored by Baghdad”, explained the Kurdish official. On paper, this agreement puts a temporary end to a dispute between Baghdad, Erbil and Ankara. Last Saturday, Turkey stopped importing oil from Iraqi Kurdistan after a court ruling in favour of the federal government. In 2014, Baghdad had filed a lawsuit against its Turkish neighbor at the arbitration tribunal of the International Chamber of Commerce in Paris, following Ankara’s announcement to import oil from Iraqi Kurdistan to the port of Ceyhan.

The Iraqi government was strongly opposed to the Turkish decision, believing that it was the exclusive manager of this oil. Ignoring Baghdad’s opposition, Erbil began exporting to Turkey. Today, these exports amount to about 450,000 barrels per day (bpd). The freeze on Kurdish exports had forced the Norwegian company DNO, one of the main oil producers in Iraqi Kurdistan, to stop its operations in the region.

Erbil believes that the central government is trying to get its hands on its wealth. Baghdad, for its part, wants to have a say in the exploitation of hydrocarbons throughout Iraq.

Iraq is the second largest country in the Opec and exports an average of 3.3 million barrels of crude oil per day.

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