Oil shipment from Iraq ‘not to affect oil prices’

Oil shipment from Iraq ‘not to affect oil prices’

Oil shipment from Iraq ‘not to affect oil prices’

Turkish Energy Minister Taner Yıldız speaks during a press conference. AA photo

Oil flow from Iraq or the Kurdistan Regional Government (KRG) through Turkey will not affect Turkey’s oil prices, Energy Minister Taner Yıldız said during an interview with the private broadcaster NTV in Paris yesterday.

Following a question about a potential pipeline between the Persian Gulf and Turkey, Yıldız stated that the Kirkuk-Ceyhan crude pipeline was more convenient for oil shipment, rather than a pipeline from the Persian Gulf to Turkey, because the Persian Gulf’s coasts were not convenient for shipment. The Kirkuk-Ceyhan pipeline is able to deliver to global markets that have higher capacity, he said. There was some vulnerability, but that have been resolved, he said, adding the pipeline was a safe route and market for particularly Iraq and other countries in the Middle East. 

Yıldız also said oil shipment from Iraq or the KRG would not have effects on Turkey’s oil prices. The oil prices in the world are determined according to one single price, he said. While Turkey imports $60 billion of energy, it exports $8 billion, he said, adding that this $52 billion energy import was used in transport. He noted at this point, Turkey’s security for supply is also crucial and the number of supplier countries should rise.

However, there is a long-running dispute between the central government in Baghdad and the autonomous KRG over how to develop the country’s resources. Yıldız noted gains from future deals with the central government of Iraq or the KRG belonged to all of Iraq.

Last week, Ankara proposed a formula to both the KRG and the central government to build multi-billion dollar oil and gas pipelines to ship the autonomous region’s rich hydrocarbon reserves to world markets. The proposal aims to tie oil and gas money to a Turkish state bank in accordance with the agreed share of 83% to the Iraqi central government and 17% to the KRG, after measuring the amount of oil along with a monitoring commission Yıldız said, adding, the parties in Iraq would then decide how to share the money.