Revival of Kirkuk-Kurdistan Oil Pipeline: A Boost to Iraqi Oil Exports, 5 OCT

 Revival of Kirkuk-Kurdistan Oil Pipeline: A Boost to Iraqi Oil Exports, 5 OCT

The oil pipeline connecting the Kurdistan Region and Kirkuk is now fully operational, announced Turkish Energy Minister, Alparslan Bayraktar. This development signals Turkey’s readiness to recommence oil shipments, marking a significant milestone in the global oil industry.

Origins of the Dispute

The dispute over independent Kurdish oil exports has been a contentious issue between Ankara and Baghdad for nearly a decade. A 2014 agreement between Ankara and Erbil allowed oil pumped in landlocked Iraqi Kurdistan to be independently sold via Turkey’s Mediterranean port of Ceyhan. This move was met with resistance from Iraq, which argued that Turkey had violated a 1973 pipeline agreement by enabling oil exports from Iraqi Kurdistan without its consent. The disagreement led Iraq to file an arbitration case with the International Chamber of Commerce (ICC).

Further tensions arose when Kurdish supporters clashed with protesters following the evacuation of the Iraqi military’s Joint Operations Command headquarters in Kirkuk. The fallout resulted in heightened security interventions, a citywide curfew, and four tragic deaths. The decision to evacuate the headquarters was part of a broader political bargain to secure the backing of the Kurdish Regional Government (KRG) for a government under Mohammed Shia al Sudani in Baghdad.

Kirkuk: A Key Player in Energy Security

The Kirkuk-Ceyhan oil pipeline, which stretches between Iraq and Turkey, symbolizes the significant partnership between the two nations. However, control and revenue distribution from this pipeline have been contentious, especially during periods when the KRG has attempted to bypass Baghdad and export oil directly to Turkey. These actions have been perceived by the Iraqi central government as breaches of its sovereignty, leading to political disputes.

Ankara-Erbil Bond: Overlapping Interests in Kirkuk

Since 2014, the central government in Baghdad has consistently maintained that Iraqi Kurds have been exporting Iraqi oil through Turkey, a transaction carried out without the requisite approvals from the central authorities. This issue was escalated to an international forum, where the Paris-based International Chamber of Commerce ultimately ruled in favor of Baghdad, imposing a significant penalty of $1.5 billion on Turkey. In retaliation, Turkey halted the transport of approximately 400,000 barrels per day of Kurdish crude oil, along with an additional 75,000 barrels per day originating from the Kirkuk fields.

Resumption of Oil Pipeline Operations

Turkish Energy Minister Alparslan Bayraktar recently announced the reoperation of the oil pipeline, signaling Turkey’s readiness to recommence oil shipments. Amid ongoing financial pressures on both Baghdad and the Kurdistan Region, the resumption of the pipeline operation represents a significant breakthrough in the global oil industry and a vital step towards enhancing the flow of Iraqi oil to international markets.