Baghdad and the Kurdistan Regional Government (KRG) have moved closer to resolving a key issue that halted oil exports through the Iraq-Turkey pipeline. As part of this effort, Baghdad agreed to avoid changes to contracts held by international oil companies operating in the Kurdistan Region, marking significant progress toward an Oil Export Agreement.
Therefore, this development follows ongoing talks between the federal government and the KRG. Both sides now expect a final decision after a meeting by Iraq’s Coordination Framework coalition. The meeting will likely address oil export terms and the KRG’s long-standing salary crisis.
Additionally, a source in Baghdad confirmed this progress. He explained that both oil and salary disputes remain top priorities. Another source from the Association of the Petroleum Industry of Kurdistan (APIKUR) confirmed that Erbil and Baghdad reached a new understanding. The source added that Baghdad promised not to interfere with existing contracts during cost assessments.
Moreover, APIKUR praised both governments for accelerating efforts to resume the oil flow. The association, which includes eight international companies, confirmed that member companies can restart oil exports through the pipeline once legal and financial guarantees are signed.
“Oil exports must reflect existing legal terms,” said an APIKUR spokesperson. He added that all companies expect payment guarantees and a clear path to resolve overdue revenues. The oil export agreement now depends on clear contract enforcement and a reliable payment mechanism.
The pipeline linking Iraq and Turkey has remained closed since an international court ruling in Paris. That decision favored Baghdad and blamed Ankara for violating a decades-old agreement by accepting oil exports from Erbil.
APIKUR officials insisted that all contracts fall under international law. They repeated the demand that Baghdad fully respect the terms already in place.
Iraq’s 2025 budget requires the KRG to supply 400,000 barrels per day to the State Oil Marketing Organization (SOMO). However, a new dispute has surfaced. Iraq’s oil minister said Erbil raised its request for internal oil use from 46,000 to 65,000 barrels per day. He called this change a breach of the budget agreement.
The suspension of exports has created severe financial hardship for the KRG. Over $25 billion in lost oil revenues has strained the region’s ability to pay salaries. Baghdad cut off budget payments to Erbil, claiming the KRG failed to meet its obligations.
Despite the tension, APIKUR said its companies remain ready to resume exports as soon as binding agreements are signed. The future of the oil export agreement now hinges on Baghdad’s next steps.