Iraq has officially resumed crude oil exports from the semi-autonomous Kurdistan region to Turkiye, breaking a two-and-a-half-year impasse that stemmed from legal and technical disputes. This significant development marks a pivotal moment in Iraqi energy relations, occurring after an interim agreement was reached among Iraq’s federal government, the Kurdistan Regional Government (KRG), and foreign oil producers.
The resumption of operations commenced at 6 am local time (03:00 GMT) on Saturday, with Iraq’s oil ministry confirming the smooth initiation of the process without significant technical issues. Turkish Energy Minister Alparslan Bayraktar also affirmed the restart of operations through a post on social media platform X.
Under the newly established agreement, crude oil exports are projected to range from 180,000 to 190,000 barrels per day (bpd) destined for Turkiye’s Ceyhan port. The agreement was facilitated by a tripartite understanding formed earlier in the week, aligning the interests of the Iraqi federal government, the KRG, and international oil companies active in the region.
U.S. involvement in the negotiations has been instrumental, with Secretary of State Marco Rubio expressing optimism that the deal will yield significant benefits for both Americans and Iraqis. The revival of oil flows is anticipated to reach a total of 230,000 bpd in the future, potentially revitalizing the country’s presence in international markets, precisely during a period when the Organization of the Petroleum Exporting Countries (OPEC) is advocating for increased output to enhance its market share.
Reportedly, Iraq’s delegate to OPEC, Mohammed al-Najjar, conveyed that the country is poised to expand its export capabilities beyond current levels due to this resumption. The agreement also stipulates that companies operating in the Kurdistan region will receive per barrel to defray production and transportation expenses.
While the management of lucrative oil exports has historically been a contentious issue between Baghdad and Erbil, this new framework aims to strengthen Iraq’s oil revenue streams and foster a more stable relationship between the two governments. Prior to this deal, the Kurdish authorities had independently marketed their oil without federal oversight, leading to a significant halt in exports when the International Chamber of Commerce ordered Turkiye to compensate Iraq for unauthorized sales, resulting in estimated losses exceeding billion since the pipeline’s closure in March 2023.
The restoration of this vital energy conduit stands to enhance Iraq’s economic prospects while affirming the importance of cooperation between regional authorities and the central government.
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