Kurds lose fight to sell crude oil in U.S. after Iraq sues

A Kurdish crude oil cargo sales discharged in Israel was the factor that upheld a court order for the ban of Kurdish oil to the U.S.

Kurds lose fight to sell crude oil in U.S. after Iraq sues

World Bulletin / News Desk

Iraq’s self-governing Kurds have been banned from selling Iraqi crude oil in the U.S. under a court decision that puts a fresh hurdle in the path of Kurdish efforts to achieve financial independence from the central government in Baghdad.

According to a report in Bloomberg, the case began last year when Iraq’s central government sued to seize a tanker loaded with crude from the country’s Kurdish region that had sailed to the Gulf of Mexico and anchored off the coast of Texas. The appeals court upheld an order by a judge in Houston requiring the KRG to notify him before trying in the future to sell any oil in the U.S.

According to ording to BP Plc data Iraq’s minority Kurds, are independently developing oil reserves they say may total 45 billion barrels -- equivalent to almost a third of Iraq’s total deposits. When the KRG sought to export oil on its own last year, the central government waged a legal battle to stop Kurdish cargoes from unloading, including the tanker that anchored near the Texas coast.

Oil reserves to increase for Turkey

"Including Kirkuk oil, we currently deliver 700,000 bpd to Turkey, and we suppose it will rise to 900,000 bpd by the end of this year," Delshad Shaban, the deputy head of the oil and gas committee in the Kurdish parliament, told Anadolu Agency.

Concerning the oil sent to the central government of Iraq, Shaban said the regional government delivers 150,000 bpd of Kirkuk oil to the Iraqi government's oil company, SOMO, at the Ceyhan port of Turkey. 

"Iraq violates the agreement by not sending the Kurdistan region's share of the national budget," said Shaban, adding that Baghdad aimed to use the budget issue as a tool of oppression against Erbil.

The KRG is supposed to receive 17 percent of the national budget from the Iraqi central government to reimburse it for oil provided to the national oil company, according to an agreement signed by both parties at the end of last year. 

But a dispute between the Kurdish region and Baghdad has kept the KRG from receiving the payments. This has caused a liquidity crisis for the region, and the regional government has chosen to export its oil to the international markets independently.

"I do not believe that the central government will implement the budget act of 2016 and send Kurdistan's $11 billion share," said Shaban.

Güncelleme Tarihi: 22 Eylül 2015, 15:30