450,000 Bpd Flow Of Kurdish Crude Unlikely To Restart This Weekend - OilPrice.com
450,000 Bpd Flow Of Kurdish Crude Unlikely To Restart This Weekend | OilPrice.com
While the Iraqi oil minister has said that 450,000 barrels per day of shut-in oil exports from Iraqi Kurdistan would restart exports on Saturday, Kurdish and Turkish officials both said on Friday that it is unlikely the pipeline would be turned back on in that timeframe.
The pipeline was closed down on March 25 by Turkey, following an international arbitration ruling in favor of Iraq against Turkey. The pipeline shut-down removed Kurdish oil from the market that it was exporting unilaterally to Turkey, against the wishes of the Iraqi federal government.
On Thursday, Iraqi and KRG officials said they had submitted a request on Wednesday for Turkey to restart the pipeline to the Turkish port of Ceyhan, which delivers oil from the Kurdistan Region of Iraq to markets.
The Iraqi oil minister said the request was for Turkey to restart the pipeline on Saturday, suggesting that the request would be accepted immediately. Kurdish officials had been more circumspect, noting to the media that Ankara had not yet responded to the request at the time.
While the Iraqi federal government and the Kurdistan Regional Government (KRG) have agreed to a deal to allow the oil to be exported again, Turkey will have the final say as it controls the pipeline at the port of Ceyhan.
Under the new deal between Baghdad and the KRG, the Iraqi federal oil marketing agency, SOMO, will sell Kurdish oil going forward, with revenues going into a bank account controlled by the Kurds. Kurdish officials maintain that all contracts with oil traders will belong to Erbil, while the oil will be exported through SOMO.
“It is the same contract and with the same companies, but with the prices of SOMO,” Kurdistan Region Electricity Minister Kamal Mohammed, acting as the Minister of Natural Resources, told Rudaw.
Turkey, in the meantime, is preparing for a critical election on May 14, and Turkish officials have previously indicated that they might hold off on restarting the KRG oil pipeline as they further negotiate the $1.5-billion arbitration settlement with Iraq.
By Charles Kennedy for Oilprice.com
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