Iraqi Kurdish oil exports resumption to be announced in hours, ministry says

Iraq's oil ministry said on Friday that it will announce the resumption of oil exports from the Iraqi Kurdistan region within the “coming hours”, ending a nearly two-year dispute over crude shipments. The country will announce the direct export of the region's oil through the state-run oil marketing company SOMO via the Turkish Ceyhan port, starting at an initial rate of 185,000 barrels per day (bpd), which will be gradually increased, the ministry said. A 970km pipeline transports Iraqi crude oil, primarily from Iraq’s Kirkuk area to export terminals at Ceyhan, on Turkey's Mediterranean coast. In March 2023, Turkey suspended the flow of about 450,000 barrels of Iraqi oil daily through the Ceyhan pipeline, with roughly 370,000 bpd originating from the Iraqi Kurdistan region. The stoppage came after an arbitration court ruled in favour of Baghdad, saying Ankara had breached a 1973 agreement when it allowed the Iraqi Kurdistan administration to pump without the consent of the federal government in Baghdad. Since then, Baghdad and the region have failed to agree on issues related to resumption of exports, including the approval of deals the Kurds signed unilaterally with oil companies and a system for the payment of developers. However, several oil companies operating in the Kurdistan region said they would not resume exports today. The Association of the Petroleum Industry of Kurdistan (Apikur), composed of eight international oil companies that produce more than 60 per cent of Kurdistan's oil, said its members had not received any outreach from the Iraqi government to establish new agreements ensuring payment for past and future exports in line with their existing terms. “We remain ready to meet with appropriate officials to discuss these issues and restore exports of oil for the benefit of all Iraqi people,” the group said in a statement to The National. Comments from Kurdish officials contacted by The National also indicated a delay in the resumption of exports. The actual date for a resumption remains unknown, with a Kurdish official from the presidency office saying: “There is no specific day.” People close to the negotiations suggest Kurdish oil exports to Ceyhan port, and subsequently to Mediterranean markets, are likely to restart soon, possibly within the first week of March, though no precise date is available, another official in the Kurdish regional government said. Last week, Reuters cited sources as saying that the Trump administration has been piling pressure on Iraq to allow Kurdish oil exports to restart or face sanctions alongside Iran. Growing pressure from the Trump administration was a key factor behind Iraqi Oil Minister Hayan Abdul Ghani’s surprise announcement last Monday of plans to resume exports from Kurdistan this week, the report said. An adviser to Iraq’s Prime Minister Mohammed Shia Al Sudani denied the report, saying there had been no threat of sanctions “or any form of pressure” on Iraq in all the contacts that had taken place with the US administration recently. “My understanding is that Trump wants more oil production [to further] his geopolitical objectives vis-à-vis Russia and Ukraine,” said Zahra Ladha, a geopolitical analyst. “That's the backdrop against which we've seen this happen, because the export of oil from the Kurdistan region is more like a domestic issue between the two centres of power in Iraq – Baghdad and Erbil,” she told The National. Oil prices fell on Friday and were on track to record their first monthly loss since November. Brent, the benchmark for two thirds of the world’s oil, was trading 0.74 per cent lower at $73.49 a barrel at 1.56pm UAE time. West Texas Intermediate, the gauge that tracks US crude, was down 0.97 per cent at $69.67 a barrel.

Iraqi Kurdish oil exports resumption to be announced in hours, ministry says

Iraq will export 185,000 barrels per day through state-run oil marketing firm SOMO