Northern Iraqi Oil Flows Remain At A Standstill

Northern Iraqi crude oil flows to Turkey’s port of Ceyhan remain at a standstill, as further talks between Iraq and Turkey are needed in order to resume flows.

• Iraq was forced to halt around 470kbpd of crude oil exports from the northern region on 25 March through the export pipeline to the Turkish port of Ceyhan. The stoppage removed around 400kbpd of crude oil exports controlled by the KRG and 70kbpd controlled by the federal Iraqi government. Flows have not resumed since the halt on 25 March.
• On 19 June a Turkish energy delegation has met with Iraqi oil officials in Baghdad to discuss the resumption of flows. However, the meeting has not resulted in a final decision and further meetings are expected to take place between the two parties.
• While the meeting had the focus of discussing technical aspects, an oil official said the decision to restart flows needs political talks on high levels and the issues regarding the restart are more political than technical.
• It seems likely that Turkey is responsible for the prolonged halt of flows, while it is not certain was causes the delay to greenlight the resumption of flows on the Turkish side.
• According to Iraqi oil officials, there are no obstacles on Iraq’s side to resume flows and Iraq has just been awaiting greenlight from Turkey. The Iraqi federal government, SOMO, the KRG and oil companies signed an agreement to resume flows in late April. Both governments agreed that the selling of oil from Iraq’s northern fields will only be carried out by Iraq’s SOMO.
• Previous attempts by Iraq to restart flows were delayed by Turkey’s presidential election in May. Hopes for a restart increased when Turkey's President Tayyip Erdogan named Alparslan Bayraktar as energy minister on 3 June.
• Iraq had previously hoped to resume northern oil exports on 13 May but the outstanding response from Turkey had prevented the restart. Turkish authorities previously requested a short period of time to examine the oil-pumping lines and pipeline ton Ceyhan to ensure safety.
• Argusmedia reported that Turkey wants another case that covers flows in the period from 2018 onward resolved, before reopening the pipeline, while other sources said Turkey is seeking in-person negotiations relating to the $1.5bn it was ordered to pay Iraq in damages.