Iraq-KRG Disputes Disrupt Crude Oil Exports via Ceyhan Port

The Iraqi-Kurdistan Regional Government dispute has frozen crude oil exports at the Ceyhan port, with disagreements over budgetary provisions and consumption rates causing delays. A Kurdish delegation is set to negotiate with Iraqi officials, while rumors of Iraq leaving OPEC have been dismissed. Financial disputes also hinder the resumption of exports.

The ongoing discord between Iraq’s federal government and the Kurdistan Regional Government (KRG) has resulted in a prolonged suspension of crude oil exports via the Ceyhan port in Turkiye, as indicated by the Iraqi Parliamentary Oil and Gas Committee. Ali Shaddad, spokesperson for the Committee, affirmed that the Ministry of Oil had completed all necessary preparations to resume exports, following new budget law amendments allowing for export volumes between 300,000 and 325,000 barrels per day (bpd).

However, Shaddad criticized the KRG’s intention to raise local consumption from 46,000 bpd to 110,000 bpd, labeling this request a violation of the approved budget and stating that it impedes the resumption of exports. He pointed out the limitations of negotiators, who do not possess the authority to alter legal provisions. The KRG has claimed that reaching the agreed export levels is impractical, which may lead to additional delays.

Shaddad emphasized the contrasting perspectives between the federal government, which views oil export regulations as legal and technical, and the KRG, which interprets them from a political standpoint. He noted Iraq’s commitment under OPEC to export 400,000 bpd from the north, yet only 300,000 bpd has been dispatched, leading to significant financial losses.

While there have been rumors regarding Iraq’s potential exit from OPEC, these have been categorically rejected by Shaddad, who warned that such a move would diminish Iraq’s oil revenues and its international status. A Kurdish delegation is anticipated to meet with Iraqi oil officials in Baghdad shortly to negotiate a resolution to this ongoing dilemma. Financial disagreements have also surfaced as a critical barrier to resuming exports, with oil companies in the Kurdish region demanding advance payments for production and transportation, while Baghdad holds back payments pending resolution of financial disputes.

In summary, the dispute between Iraq’s federal government and the KRG continues to hinder crude oil exports through the Ceyhan port. Key factors include disagreements over budgetary provisions and local consumption rates. Discussions are anticipated to occur between Kurdish and Iraqi officials to seek a resolution. Moreover, speculation surrounding Iraq’s exit from OPEC has been denied, underlining the country’s commitment to fulfilling its export obligations. Financial disputes remain a significant obstacle to resuming operations.

Original Source: shafaq.com