Breakthrough Agreement in Iraqi Kurdistan Oil Export Deadlock

Eight oil companies in Iraqi Kurdistan have reached a preliminary agreement with Iraq's federal and Kurdish regional government to resume oil exports. This agreement could end the months-long export suspension, with the potential to restart the Iraq-Turkey pipeline and address payment arrears to producers.

Eight oil companies operating in Iraqi Kurdistan, which account for over 90% of the region's production, have reached an agreement in principle with Iraq's federal and Kurdish regional governments to restart oil exports, according to an industry group announcement on Wednesday.

The potential deal signals a significant step towards ending the export impasse and may soon permit the flow of approximately 230,000 barrels of crude per day through the long-suspended Iraq-Turkey pipeline. The Association of the Petroleum Industry of Kurdistan (APIKUR) expressed optimism that the framework agreement, pending its formalization, will reopen exports while setting the stage for future long-term arrangements.

While APIKUR represents eight companies, Norway's DNO and UK's Genel Energy have not yet endorsed the agreement. Local entities like KAR Group and Forza Petroleum are in favor of the plan, which retains existing contract integrity and addresses payment guarantees for international oil companies. The framework includes plans for clearing Kurdish regional government arrears, estimated near $1 billion.

(With inputs from agencies.)