Iraq resumes oil exports via pipeline running through Kurdish-populated territory

Iraq is resuming oil exports via a pipeline that runs through a region inhabited by a Kurdish minority. The war in the Middle East has severely disrupted oil production in the country, so the pipeline ending on Turkey’s Mediterranean coast offers the government in Baghdad some hope, the DPA news agency reported today.

The central government has agreed with officials from the semi-autonomous Kurdish region to reopen the important pipeline. Talks are also continuing on lifting the embargo on Kurdish oil traders. Kurdish Prime Minister Masrour Barzani said the country was facing extraordinary circumstances. “We all share responsibility for overcoming this difficult chapter,” he added.

The Iraqi government and the Kurdish region have been at odds for years over how the pipeline should be operated and how oil export revenues should be shared. The government in Baghdad hopes to export around 300,000 barrels a day via the pipeline, which resumed operations today.

Iraq has already significantly cut oil production because of the effective blockade of the Strait of Hormuz resulting from the US-Israeli war against Iran. Iraqi Oil Minister Hayan Abdul Ghani said the country is currently producing only 1.3 million barrels of oil a day, around 30 percent of its normal output.

Oil prices are reacting to news that the Iraqi pipeline has resumed operations. They rose by three percent on Wednesday. Today, at around 9:30 CET, North Sea Brent was down 1.1 percent at below USD 102.30 a barrel, while US light crude WTI was down 2.4 percent at below USD 93.90.