Iraq restarts Kurdish oil exports via Turkey after two-year halt

Oil flows return after arbitration dispute; Baghdad–Irbil deal sets $16 per barrel cost

Iraq will resume exporting crude from its northern Kurdish region through Turkey’s Ceyhan port starting Saturday, officials told the Associated Press. The move ends a two-year stoppage that had slashed revenues and strained relations between Baghdad and the semiautonomous Kurdish Regional Government (KRG).

Ali Nizar al-Shatari, head of Iraq’s State Oil Marketing Organisation, said pumping will begin at 6 a.m. with an agreed quantity of 240,000 barrels per day. Of that, 180,000–190,000 barrels will be exported, while roughly 50,000 barrels will be consumed within the Kurdish region.

Why exports stopped and why now

The suspension dates back to early 2023, when the International Chamber of Commerce ruled against the KRG’s independent exports in an arbitration case. Several attempts at compromise failed, leaving billions in potential revenues untapped.

The breakthrough came after months of negotiations, culminating in a tripartite agreement between Iraq’s Oil Ministry, the KRG’s natural resources ministry, and international oil companies operating in Kurdistan. Under the deal, companies will be paid $16 per barrel to cover production and transport costs.

US pressure and Turkey’s role

The United States, long worried about Iraq’s fiscal stability and regional influence, backed and closely monitored the agreement. U.S. Secretary of State Marco Rubio called it a “tangible benefit for both Americans and Iraqis.”

Baghdad’s export agreement with Turkey runs until July 2026. Officials confirmed talks will begin with Ankara on renewing the deal.

International oil companies react

Norwegian operator DNO ASA, which produces oil in Kurdistan, confirmed it had received instructions to prepare for exports through the Iraq-Turkey pipeline. While DNO won’t directly export, it will sell to buyers who then transfer crude to the export pipeline.

DNO Executive Chairman Bijan Mossavar-Rahmani also announced a major production expansion plan and replacement of equipment damaged in July drone attacks on its Iraqi fields.

Old wounds, new pragmatism

Disputes over oil revenues have long defined Baghdad–Irbil relations. In 2014, Kurdish authorities began unilaterally exporting oil via Turkey to compensate for withheld budget transfers from Baghdad — a move the federal government branded illegal.

Today’s arrangement does not resolve all disputes but signals a temporary détente. For Baghdad, the restart boosts fiscal inflows at a time of tight budgets. For the Kurds, it restores a critical revenue lifeline.