Shafaq News / Amang Rahim, Secretary of the Council of Ministers of the Kurdistan Region, announced on Sunday that the President of the Iraqi Republic Abdul Latif Jamal Rashid ratified the first amendment to the Iraqi Federal Budget Law on the export of oil from the Kurdistan Region through the national oil marketing company “SOMO”.
Rahim said in a post on social media today that the President of the Republic signed the first amendment to the Iraqi Federal Budget Law No. 13 of 2023 on the export of the region’s oil through (SOMO).
He explained that “in accordance with the provisions of the amendment related to the cost of producing and transporting oil, the proceeds from the sale of oil exported from the Kurdistan Region will return to the Federal Treasury.”
Rahim added that “in order to apply the law, only one stage remains, which is its publication in the official Iraqi newspaper of facts.”
The Iraqi Council of Representatives voted, in early February, on the draft law of the first amendment to the federal general budget law of the Republic of Iraq for the fiscal years (2023 – 2024 – 2025) No. (13) of 2023.
Iraqi Foreign Minister Fouad Hussein confirmed on Saturday that Baghdad worked to settle technical issues with the Kurdistan Regional Government to restart the crude oil export pipeline to Turkey, after a close of nearly two years that cost Iraq about $ 19 billion in lost revenues.
Turkey stopped the flows on the pipeline, which transports oil from the Kurdistan region of Iraq to the Turkish port of Ceyhan, in March 2023 after an arbitration court ordered it to pay about $ 1.5 billion in compensation to Iraq to transport oil without the consent of Baghdad. Ankara refused to pay the fine at the time and asked Erbil to pay it.
The closure of the pipeline led to the suspension of Iraqi oil exports of about 500,000 barrels per day, and the resumption of oil flows from Kurdistan may alleviate some of the impact on markets due to the reduction of shipments from Iraq, the main exporter of crude.
Iraq was exporting about 400,000 to 500,000 barrels per day from the northern fields, including the Kurdistan Region, through the now-stalled pipeline, and Oil Minister Hiyan Abdul Ghani said earlier this month that Iraq plans to transfer at least 300,000 barrels per day of crude oil once operations resume, adding that the Iraqi administration also began a formal process to convince the regional government to transfer oil to the Federal Oil Marketing Company (SUMO).
Turkey has repeatedly said that the pipeline is ready to work and that it is up to Iraq to resume flows, and the United States has expressed a strong desire to see oil flowing through the Iraqi-Turkish pipeline.
The resumption of shipments through the pipeline could pose a dilemma for Baghdad, which is committed to cutting crude production as part of the OPEC+ agreement but is struggling to commit to the promised cuts.
The production and exports of the Organization of the Petroleum Exporting Countries are under increasing scrutiny after US President Donald Trump last month called on the group to “lower the price of oil”.