Live: Oil-for-gas deal reached with Iran

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12. July 2023 18:03

Oil export halt is down to Baghdad-Erbil issues – Erdogan


Nothing to do with us, protests Turkish President Recep Tayyip Erdogan.

"Both we and [the Iraqis] would benefit" from a resumption in oil exports, he says. 

That flies in the face of everything said and briefed by Iraqi and Kurdistan officials.
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12. July 2023 15:01

The commission has responded rather robustly to President Barzani's letter


In a statement to Kurdistan 24, the commission says it has said "many times" that it is able to conduct elections in Kurdistan but not "alongside the provincial elections" and not "sooner than six months" in advance.

The statement does not say why it can't conduct both elections together. 
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12. July 2023 14:10

Kurdistan Region president asks federal electoral commission to prepare for election – reports


Hmm.. Rudaw (linked to the president himself) says President Nechirvan Barzani (KDP) has asked the electoral commission to prepare Kurdistan's parliamentary elections for this year.

Not sure the PUK will be too enthused about this development. There have been no indications about a breakthrough in talks between the PUK and KDP on how and when to hold elections.
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12. July 2023 13:32

Turkey presses for terms amid oil dispute with Iraq – Amwaj


Nearly four months after an arbitration ruling by the International Chamber of Commerce (ICC) ordered Turkey to compensate Baghdad for allowing unauthorized oil exports from Iraqi Kurdistan, the future of crude oil transfer from Iraq to Turkey remains uncertain, Mehmet Alaca reports for Amwaj. Amid ongoing tensions and talks, Ankara has reportedly put forth a series of demands.

The dispute, which dates back nearly a decade, has its roots in a 2014 agreement between Ankara and Erbil which facilitated the sale of oil from landlocked Iraqi Kurdistan via Turkey’s Mediterranean port of Ceyhan. Responding to this, Iraq argued to the ICC that Turkey had violated a 1973 pipeline agreement by allowing oil exports without its permission. The ICC ruled in favor of Iraq in March 2023, ordering Turkey to pay about $1.47 billion in compensation for facilitating the oil exports from 2014 to 2018 without Baghdad's consent.

Since the ruling, Turkey has largely stayed silent about the payment of the compensation.

However, Amwaj.media says that an anonymous Turkish source told them: 

  • Ankara seeks to negotiate the compensation awarded to Iraq, asking to pay in installments.
  • Turkey also aims to play a more active role in future Kurdistan Regional Government (KRG) oil operations
  • It wants to receive discounts on KRG crude going forward
  • And it demands from Iraq it withdraws a second lawsuit that is still pending.

Despite an estimated loss of over $2b due to the halt of exports, efforts to resume crude exports have been met with political hurdles. Reports suggest that Turkey may be leveraging the situation to negotiate the compensation amount.

While Turkish and Iraqi delegations have called for further talks, there have been no clear signs of any resumption of crude exports.
Deep Dive: Will Turkey agree to resume oil shipments from northern Iraq?
The transfer of crude oil from Iraq to Turkey remains suspended, almost four months after an arbitration ruling found that Ankara owes Baghdad compensation for enabling unauthorized exports from Iraqi Kurdistan. Despite unconfirmed reports of an impending visit to Iraq by Turkish President Recep Tayyip Erdogan, there are few indications of a deal on the horizon. Origins of the dispute Ankara and Baghdad have clashed over independent Kurdish oil export for almost a decade. Under a 2014 Ankara-Erbil agreement, oil pumped in landlocked Iraqi Kurdistan was independently sold via Turkey’s Mediterranean port of Ceyhan. Of note, most of federal Iraq’s oil exports are shipped through the southern Gulf coast.
Amwaj.media
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12. July 2023 12:54

Iraqi Federal Supreme Court halts implementation of budget law articles


The Federal Supreme Court of Iraq has put in a temporary halt on the enforcement of specific articles from the federal general budget law for the fiscal years 2023-2024-2025. The directive includes a suspension of lines in Articles 28, 57, 65, 70, 71, and 75.

The order arrives as the Court considers a constitutional appeal against these articles by the Iraqi PM. Parliament went to town on the government's budget bill for months before finally passing one that bore some resemblance to the government's draft. It added, amended, and excised dozens of articles and clauses before passing the bill in a marathon weekend of late night/early morning finishes. 

The PM is now fighting back against what it considers legislative overreach into executive affairs.
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12. July 2023 12:23

Iraq channels Kurdish oil to Baiji refinery and disputed territories

Kurdistan 24, a news organization affiliated with KRG Prime Minister Masrour Barzani, reports that the Iraqi Oil Ministry is tapping into Kurdistan's oil resources. As an initial action, 150,000 barrels of oil per day from the Kurdistan Region are being dispatched to the Baiji oil refinery. An additional 250,000 barrels are earmarked for factories located in the disputed territories, areas that have suffered from Arabization policies enacted by previous Baathist regimes. This comes as Kurdish crude remains stuck after Turkey closed its border to Kurdistan oil exports.

Sabah Subhi, an Iraqi Parliament's Oil and Gas Committee member, informed Kurdistan 24 of the shift in source for the Baiji refinery - from Basra to the Kurdistan Region. Salah Bushi, advisor to the Iraqi prime minister on Kurdistan Region affairs, reaffirmed the Iraqi government's commitment to honoring Kurdistan's financial entitlements following receipt of the region's refined oil.

The overall state of Erbil-Baghdad relations was described as "excellent" by Omed Sabah, Chief of Staff to the Council of Ministers’ Presidency, while talking to Kurdistan 24. Sabah revealed that a high-level team, including KRG Prime Minister Masrour Barzani and Iraqi Premier Mohammed Shia Al-Sudani, had been assembled to implement the budget law.

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12. July 2023 12:02

KRG delegation to visit Baghdad for budget implementation talks


A high-level delegation from the Kurdistan Regional Government (KRG) is slated to visit Baghdad for talks regarding the practical aspects of implementing the federal budget law, according to the KDP-linked Bas News. The Iraqi federal parliament recently voted for the budget bill, granting financial entitlements to the Kurdistan Region.

Both Baghdad and Erbil are depending on this law to deliver public services and fulfill their obligations regarding public sector salaries. The KRG especially, given its precarious financial position in the aftermath of energy exports being shut down.

The devil's in the details, however. Just how the budget will be implemented hinges on the forthcoming negotiations between the KRG and the Iraqi government.

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12. July 2023 11:49

Iraq to trade crude oil for Iranian gas


Iraq is set to initiate a barter system to mitigate the recurring issue of delayed payments to Tehran due to the necessity for US approval, said Prime Minister Sudani. The decision comes in response to a cut in gas exports from Iran, by over 50% since July 1, due to unpaid bills by Iraq to Iran. 

With temperatures in Iraq topping 50 Celsius during the sweltering summer months, and power consumption at its peak, this crude-for-gas deal could be a lifeline, potentially helping to prevent power outages.

The arrangement is expected to pave the way for the country to complete vital gas capture and extraction projects, contributing to self-sufficiency in the energy sector. The US has yet to comment on whether this arrangement might infringe existing sanctions. The US has given sanction waivers in the past so Iraq can pay Iran for crucial gas supplies.

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12. July 2023 10:51

Morning briefing


Morning, all! Here are today's main stories:


  • Iraq plans to trade crude oil for Iranian gas to overcome persistent payment delays, according to Prime Minister Mohammed Shia Al-Sudani. The initiative aims to offset summer power cuts while driving gas capture and extraction projects for self-sufficiency.
  • The Kurdistan Regional Government (KRG) is gearing up to send a high-level delegation to Baghdad, intending to discuss federal budget implementation mechanisms.
  • The Iraqi Oil Ministry has started dispatching 150,000 barrels of oil per day to the Baiji oil refinery from the Kurdistan Region. Additionally, 250,000 barrels of oil are set for shipment to the disputed territories' factories.

More updates will follow as the day unfolds.

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