An Endless Crisis: Iraq’s Federal Oil and Gas Law Stalled for Two Decades
For over two decades, Iraq has struggled to implement a federal oil and gas law, leaving the Kurdistan Region and the rest of the country trapped in a regulatory and economic limbo. Despite the country’s growing energy needs, the oil and gas sector in Kurdistan remains a zone of political obstruction and economic tension.
⚡ Systematic Obstruction in Kurdistan’s Energy Sector
Energy expert Mohammed Amin Hawramani, head of the Sustainable Energy Organization, told Baghdad Today that internal forces in Baghdad have consistently blocked expansion in the Kurdistan Region’s oil and gas sector:
Prevented development of key fields
Limited foreign company participation
Restricted the region’s capacity to secure its energy needs
This persistent obstruction has created an environment where energy infrastructure development is stagnant, despite constitutional guarantees for regional energy management.
📜 Kurdistan’s Oil and Gas Law vs. Federal Court
The Kurdistan Region enacted its own oil and gas law through its parliament. However, the Federal Constitutional Court struck it down, citing the absence of a federal law.
Key points:
The Iraqi constitution mandates a federal law to regulate oil wealth
Political disputes have left this law unpassed for nearly 20 years
This legislative vacuum has disrupted energy planning, investment, and long-term revenue stability
The stalemate has left Baghdad-Erbil relations dependent on temporary agreements, shifting with each change in government.
💰 Economic and Export Implications
The delay in legislation has had serious financial consequences:
Kurdistan’s oil exports halted for over two years due to federal objections
Losses accumulated until exports resumed under a tripartite agreement (Baghdad, Kurdistan, and foreign companies)
Lower global oil prices ($70/barrel) increased Iraq’s dependence on Kurdistan’s revenues for government salaries
Hawramani explains that the delay was not technical, but reflected a reluctance to allow the region autonomous control over production or exports, despite sales being conducted through SOMO.
🌍 Strategic Energy Dependencies
Iraq relies heavily on the Turkish Ceyhan pipeline for oil exports. This dependency is not only financial but also geopolitical:
Maintains an oil-water exchange balance with Ankara
Ensures regional strategic stability
Positions energy exports as part of broader regional interests
Without a federal law, Iraq’s energy market remains fragmented and dependent on ad-hoc solutions.
⚠️ Consequences of the Legislative Vacuum
The absence of a federal oil and gas law for 20 years has created:
Unstable regulatory environment
Hindered long-term investment
Disrupted domestic gas development plans
Fragile Baghdad-Erbil relations, subject to political shifts
Delayed transition toward efficient national oil wealth management
The lack of coherent legislation continues to be one of the biggest obstacles to building a cohesive Iraqi energy market.
🟨 Featured Snippet
Why has Iraq’s federal oil and gas law remained inactive for 20 years?
Political disputes and systemic obstruction have prevented the passage of a federal oil and gas law, despite its inclusion in the constitution. This legislative vacuum has hindered energy development in the Kurdistan Region, disrupted exports, and delayed the creation of a unified national energy market.
❓ Q&A Section
1. What is the main cause of the 20-year delay?
Political disagreements and opposition from internal Baghdad parties have blocked federal legislation and restricted regional energy autonomy.
2. How has Kurdistan tried to manage energy independently?
The region passed its own oil and gas law, but it was struck down by the Federal Constitutional Court due to the absence of a federal law.
3. What economic impacts has the delay caused?
Export halts, revenue losses, disrupted gas development, and a lack of long-term investment have all resulted from the legislative vacuum.
4. How does Iraq export oil from Kurdistan today?
Exports are conducted via the Turkish Ceyhan pipeline under temporary agreements with Baghdad and foreign companies.
5. Why is the federal law critical?
It is essential to unify Iraq’s energy market, allow efficient resource management, and stabilize Baghdad-Erbil relations for long-term economic planning.
🔗 Stay Connected — Follow Our Official Channels
📘 Blog: https://dinarevaluation.blogspot.com/
📢 Telegram: https://t.me/DINAREVALUATION
👍 Facebook: https://www.facebook.com/profile.php?id=100064023274131
🐦 Twitter/X: https://x.com/DinaresGurus
▶️ YouTube: https://www.youtube.com/@DINARREVALUATION