Iraq resumes Kurdish oil exports to Turkiye after two-and-a-half-year halt | Oil and Gas News

Management over profitable exports was a significant level of rivalry between Baghdad and Kurdistan area, with a key pipeline to Turkiye shut since 2023.

Iraq has resumed crude oil exports from the semi-autonomous Kurdistan area to Turkiye after an interim deal broke a two-and-a-half-year impasse over authorized and technical disputes.

The resumption began at 6am native time (03:00 GMT), in keeping with an announcement from Iraq’s oil ministry on Saturday. “Operations began at a fast tempo and with full smoothness with out recording any vital technical issues,” the ministry mentioned.

Turkish Power Minister Alparslan Bayraktar additionally confirmed the event in a submit on X.

The settlement between Iraq’s federal authorities, the Kurdistan regional authorities (KRG) and international oil producers working within the area will permit 180,000 to 190,000 barrels per day (bpd) of crude to move to Turkiye’s Ceyhan port, Iraq’s oil minister instructed Kurdish broadcaster Rudaw on Friday.

The resumption follows a tripartite settlement reached earlier this week between the ministry, the Kurdish area’s pure sources ministry, and worldwide oil firms working within the area.

The USA had pushed for a restart, which is anticipated to ultimately convey as much as 230,000 bpd of crude again to worldwide markets at a time when the Group of the Petroleum Exporting Nations (OPEC) is boosting output to achieve market share. US Secretary of State Marco Rubio welcomed the deal in an announcement, saying it “will convey tangible advantages for each People and Iraqis”.

Iraq’s OPEC delegate, Mohammed al-Najjar, mentioned his nation can export greater than it’s now after the resumption of flows through the Kirkuk-Ceyhan pipeline, along with different deliberate initiatives at Basra port, state information company INA reported on Saturday.

“OPEC member states have the proper to demand a rise of their [production] shares particularly if they’ve initiatives that led to a rise in manufacturing capability,” he mentioned.

Corporations working within the Kurdistan area will obtain $16 per barrel to cowl manufacturing and transportation prices. The eight oil firms that signed the deal and the Kurdish authorities have agreed to fulfill inside 30 days of exports resuming to work on a mechanism for settling the excellent debt of $1bn the Kurdistan area owes to the corporations.

Management over profitable oil exports has been a significant level of rivalry between Baghdad and Erbil, with the deal seen as a step in the direction of boosting Iraq’s oil revenues and stabilising the connection between the central authorities in Baghdad and the Kurdish area.

Oil exports have been beforehand independently bought by the Kurdish authorities, with out the approval or oversight of the federal authorities in Baghdad, via the port of Ceyhan in Turkiye.

The Kirkuk-Ceyhan pipeline was halted in March 2023 when the Worldwide Chamber of Commerce in Paris ordered Turkiye to pay Iraq $1.5bn in damages for unauthorised exports by the Kurdish regional authorities.

The Affiliation of the Petroleum Trade of Kurdistan, which represents worldwide oil corporations working within the area, put losses to Iraq for the reason that pipeline closed at greater than $35bn.