Oil flows from Iraq to Turkey are not expected to resume before October, when President
Recep Tayyip Erdogan will likely visit Baghdad, after the trip originally scheduled for August was
postponed.
Turkey suspended Iraq’s 450,000 barrels per day of crude oil exports through the Kirkuk-Ceyhan
pipeline on 25 March after an arbitration ruling by the International Chamber of Commerce
(ICC). The ICC ordered Turkey to pay damages of 1.5 billion dollars to Iraq over what it said were
unauthorized exports by Iraq's Kurdistan Regional Government (KRG) between 2014 and 2018.
In April, Iraq petitioned a US federal court to enforce the ICC arbitration award. A lack of
progress on resolving this litigation was one of the reasons behind the postponement of
Erdogan’s August visit.
Turkey, on the other hand, said the ICC had recognized most of its demands. The Energy
Ministry said the chamber ordered Iraq to compensate Turkey for several violations concerning
the case.
One of the steps Turkey is seeking from Iraq is a halt to the US litigation and as a result,
Erdogan’s visit is scheduled for October.
According to sources, Turkish and Iraqi officials are having complicated discussions, with the
resumption of flows the most difficult question, adding that it is not likely that flows would
restart this month.
Turkey has also sought a compromise to reduce the damages to be paid to Iraq under the ICC
arbitration. Allegedly, Turkey wants Iraq to drop a second arbitration case on exports covering
the period from 2018 onward.
Meanwhile, Turkey and KRG agreed to finalize pipeline maintenance before resuming oil flow.
Turkish Minister of Energy and Natural Resources Alparslan Bayraktar said in late August that
Turkey aims to expedite the revival and operation of the Kirkuk-Ceyhan pipeline as soon as
possible, adding that maintenance operations were almost complete.
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Tags: Iraq, oil, Oil Exports, oil pipeline, Other