Iraq Points the Finger at Foreign Firms for Stalled Kurdish Oil Exports

Foreign oil firms in Iraqi Kurdistan are partially to blame for the delays to the resumption of exports from the semi-autonomous region of OPEC’s second-largest producer, Iraq’s Oil Ministry said in a Monday statement carried by Reuters.

Neither foreign oil firms operating in Kurdistan nor the Kurdish authorities have submitted draft contracts for the federal government to review them in accordance with the Iraqi constitution and laws, the ministry said.      

Crude oil exports from Kurdistan have now been halted for a year, after they were shut in since March 2023 due to a dispute over who should authorize the Kurdish exports.

The impasse followed an International Chamber of Commerce ruling in March 2023 in a dispute between Turkey and Iraq regarding Kurdistan oil. The ICC ruled in favor of Iraq, which had argued that Turkey should not allow Kurdish oil exports via the Iraq-Turkey pipeline and the Turkish port of Ceyhan without approval from the federal government of Iraq.

In November, Norwegian firm DNO, one of the six members of the Association of the Petroleum Industry of Kurdistan (APIKUR), said that the international oil companies operating in Kurdistan would not be producing oil for exports until they have clarity about overdue and future payments and sales terms.

Earlier this year, the foreign companies called on U.S. Congress for immediate action to help resolve halted crude oil exports from Kurdistan.  

The Association of the Petroleum Industry of Kurdistan (APIKUR) has written a letter to Congress in which it said that “The export of oil is the foundation of Iraq’s economy, and all Iraqis will benefit when full production and global sales resume from the Kurdistan Region.”

Ten months after the Kurdish oil export route was shut over disputes, Kurdistan’s oil continued to be held back from the market due to disagreements over payments to the oil companies, Iraq’s Prime Minister Mohammed Shia al-Sudani told Bloomberg in an interview in January.  

By Tsvetana Paraskova for Oilprice.com

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