Baghdad, US turn to Iraqi Kurds for oil exports as Iran war hits supplies
Baghdad wants Kurdish pipelines to move up to 200,000 barrels per day to global markets, but Erbil is demanding relief from a dollar embargo and greater autonomy over trade.
Iraqi Prime Minister Mohammed Shia al-Sudani has appealed to the Kurdistan Regional Government (KRG) to help export up to 200,000 barrels per day (bpd) of its crude via a pipeline running to Turkey after Iraq ceased all foreign sales on March 1 due to the US-Israeli war against Iran, Al-Monitor has learned.
Ensuring Iraqi crude reaches world markets is seen as critical by the Trump administration, as Gulf nations targeted by Tehran’s missiles curb production and the Strait of Hormuz remains effectively closed. The resulting squeeze in supplies saw the price of oil surge above $100 per barrel on Sunday — before dropping down to around $90 Monday afternoon — with analysts predicting further spikes that could herald the worst crisis since the 1970s.
However, Iraqi Kurdish leaders have said they will let the oil flow only if Iraq agrees to resolve a long-standing dispute over Baghdad’s push to fully control all of the Iraqi Kurdistan region’s foreign trade, KRG officials told Al-Monitor. Many believe they now have the upper hand and are determined to leverage their perceived advantage.
“We need pragmatism in Baghdad. There is a new reality in Iraq. With crossings to Iran closed because of the war, the federal government now depends on Prime Minister Masrour Barzani’s goodwill for imports and oil exports through Turkey,” a senior KRG official speaking on background told Al-Monitor.
