KRG selling oil independently of Baghdad: Deputy

KRG selling oil independently of Baghdad: Deputy

KRG selling oil independently of Baghdad: Deputy

The Prime Minister of Iraq's autonomous Kurdish region, Nechirvan Barzani speaks during a joint press conference with the speaker of the Kurdistan Parliament (unseen) about oil agreements on May 14, 2015 in Arbil, the capital of the autonomous Kurdish region of northern Iraq. AFP Photo

The Kurdistan Regional Government (KRG) has begun selling crude oil from the region and Kirkuk independently and will receive payments without going through Baghdad, a Kurdish MP said in the Iraqi Parliament on July 8, according to media organization Rudaw. 

Arez Abdullah, chairman of the Iraqi Parliament’s Oil and Gas Committee, told Rudaw that the KRG had started exporting oil directly to world markets in July.

“This is the beginning of Iraq’s disintegration,” Abdullah said.   

KRG spokesperson Safin Dizayee told Rudaw that the decision was made to resolve the economic crisis that has stricken the Kurdistan region. He added that the decision was necessary to pay government employees’ salaries on time.
In the last oil sales report, the Kurdistan Natural Resources Ministry said that due to the long-standing budget impasse with Baghdad, the region was obliged to increase its independent crude oil sales in June.

June became the first month of large independent sales since December last year, when the KRG agreed a deal with Baghdad to transfer up to 550,000 barrels per day to Iraqi state oil company SOMO in exchange for Baghdad allocating Arbil 17 percent of budget payments, according to a Reuters report on June 29. 

The deal has faced troubles ever since, with Baghdad accusing Arbil of allocating smaller-than-agreed amounts of oil and Arbil saying Baghdad is paying less than half of what is due.