ByTsvetana Paraskova– Feb 17, 2025, 7:00 AM CST
Iraq and Kurdistan expect to complete all work to resume oil exports from the semi-autonomous Iraqi region by the end of March, following a two-year hiatus due to a dispute over authority over crude flows.
Officials from the Iraqi Ministry of Oil are expected on Tuesday to visit Erbil, the capital of Kurdistan, to finalize details regarding the oil exports, news outlet Kurdistan24 quoted Iraq’s Oil Minister Hayan Abdulghani as saying on Monday.
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Oil exports from Kurdistan have now been halted for nearly two years, after they were shut in since March 2023 due to a dispute over who should authorize the Kurdish exports.
After more than a year of futile negotiations and disputes over non-payment to foreign oil firms operating in Kurdistan, Iraq early this month cleared a major hurdle to the resumption of Kurdistan’s oil exports. Iraq’s parliament voted on a key plan for the compensation of oil companies operating in Kurdistan that would speed up the restart of crude oil exports from the semi-autonomous region.
Iraq’s parliament approved amendments in the federal budget law, under which international oil companies operating in Kurdistan will get a fixed price of $16 per barrel for the oil they produce, to be paid in advance. The oil will be delivered to and sold through the State Oil Marketing Company (SOMO).
“The federal government has officially approved the budgetary adjustments, and there are no remaining legal or financial impediments,” Kamal Mohammed Salih, the Acting Minister of Natural Resources of the Kurdistan Regional Government (KRG), told Kurdistan24.
“We are ready to move forward with the resumption of oil exports from the Kurdistan Region,” he added.
Separately, the President of the Kurdistan Region, Nechirvan Barzani, told Bloomberg on the sidelines of the Munich Security Conference this weekend that “Everything is ready now for us to export our oil,” adding that Kurdistan expects crude exports to resume by the end of March.
The resumption of Kurdistan’s exports would add about 400,000 barrels per day (bpd) to oil supply, although it is not clear yet how much of this would be allocated to international markets and how much would be kept for domestic consumption in Iraq.
By Tsvetana Paraskova for Oilprice.com
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