Most Popular
1. It’s a New Macro, the Gold Market Knows It, But Dead Men Walking Do Not (yet)- Gary_Tanashian
2.Stock Market Presidential Election Cycle Seasonal Trend Analysis - Nadeem_Walayat
3. Bitcoin S&P Pattern - Nadeem_Walayat
4.Nvidia Blow Off Top - Flying High like the Phoenix too Close to the Sun - Nadeem_Walayat
4.U.S. financial market’s “Weimar phase” impact to your fiat and digital assets - Raymond_Matison
5. How to Profit from the Global Warming ClImate Change Mega Death Trend - Part1 - Nadeem_Walayat
7.Bitcoin Gravy Train Trend Forecast 2024 - - Nadeem_Walayat
8.The Bond Trade and Interest Rates - Nadeem_Walayat
9.It’s Easy to Scream Stocks Bubble! - Stephen_McBride
10.Fed’s Next Intertest Rate Move might not align with popular consensus - Richard_Mills
Last 7 days
Stock Market Up 8 Out of First 9 months - 13th Dec 24
What Does a Strong Sept Mean for the Stock Market? - 13th Dec 24
Is Trump the Most Pro-Stock Market President Ever? - 13th Dec 24
Interest Rates, Unemployment and the SPX - 13th Dec 24
Fed Balance Sheet Continues To Decline - 13th Dec 24
Trump Stocks and Crypto Mania 2025 Incoming as Bitcoin Breaks Above $100k - 8th Dec 24
Gold Price Multiple Confirmations - Are You Ready? - 8th Dec 24
Gold Price Monster Upleg Lives - 8th Dec 24
Stock & Crypto Markets Going into December 2024 - 2nd Dec 24
US Presidential Election Year Stock Market Seasonal Trend - 29th Nov 24
Who controls the past controls the future: who controls the present controls the past - 29th Nov 24
Gold After Trump Wins - 29th Nov 24
The AI Stocks, Housing, Inflation and Bitcoin Crypto Mega-trends - 27th Nov 24
Gold Price Ahead of the Thanksgiving Weekend - 27th Nov 24
Bitcoin Gravy Train Trend Forecast to June 2025 - 24th Nov 24
Stocks, Bitcoin and Crypto Markets Breaking Bad on Donald Trump Pump - 21st Nov 24
Gold Price To Re-Test $2,700 - 21st Nov 24
Stock Market Sentiment Speaks: This Is My Strong Warning To You - 21st Nov 24
Financial Crisis 2025 - This is Going to Shock People! - 21st Nov 24
Dubai Deluge - AI Tech Stocks Earnings Correction Opportunities - 18th Nov 24
Why President Trump Has NO Real Power - Deep State Military Industrial Complex - 8th Nov 24
Social Grant Increases and Serge Belamant Amid South Africa's New Political Landscape - 8th Nov 24
Is Forex Worth It? - 8th Nov 24
Nvidia Numero Uno in Count Down to President Donald Pump Election Victory - 5th Nov 24
Trump or Harris - Who Wins US Presidential Election 2024 Forecast Prediction - 5th Nov 24
Stock Market Brief in Count Down to US Election Result 2024 - 3rd Nov 24
Gold Stocks’ Winter Rally 2024 - 3rd Nov 24
Why Countdown to U.S. Recession is Underway - 3rd Nov 24
Stock Market Trend Forecast to Jan 2025 - 2nd Nov 24
President Donald PUMP Forecast to Win US Presidential Election 2024 - 1st Nov 24

Market Oracle FREE Newsletter

How to Protect your Wealth by Investing in AI Tech Stocks

Iraqi Government Threatens Action Against Kurds as Oil Exports Set to Begin

Politics / Iraq War Jan 30, 2014 - 06:19 PM GMT

By: OilPrice_Com

Politics

Iraq's Deputy Prime Minister for Energy Affairs firmly stated the central government will take action, "including fiscal measures," if Kurdistan begins exporting oil without coming to an agreement with Baghdad. The remarks came as Minister Hussain al-Shahristani spoke at a conference in London on January 28. The Kurdish Regional Government (KRG) announced in mid-January that oil had begun to flow through a pipeline towards Turkey and that exports would officially start by the end of the month.


Shahristani argues that Kurdish oil must be exported through the State Oil Marketing Organization (SOMO), a government-owned entity responsible for marketing Iraq's oil. He reiterated that oil extracted from any region of Iraq, including Kurdistan, is the "property of the Iraqi people," meaning that it is owned by the central government.

The tough statement follows similar threats from other Iraqi government officials in recent weeks as the Kurds prepare to export oil to Turkey. On January 17 Iraqi Oil Minister Abdul Kareem Luaibi said Iraq will take legal steps to punish Turkey, Kurdistan, and the international oil companies involved in exporting oil. And on January 12 Iraqi Prime Minister Nuri al-Maliki promised to cut KRG's share of the national budget if it begins exports without approval from the central government.

The conflict escalated when Baghdad followed through on Maliki's threat. It released a draft national budget on January 15 that completely cut off funding for Kurdistan, a move meant to put pressure on the KRG to heed the central government's demands. Kurdish ministers walked out of the cabinet session when the budget was released.

The central government has been angling to prevent Kurdistan from unilaterally exporting oil to Turkey, but that does not mean Baghdad doesn't want Kurdish oil to flow. Indeed, according to the budget, the central government is requiring 400,000 barrels of oil from Kurdistan to be exported, and any shortfall will be made up by deducting from Kurdistan's share of national revenues. Kurdistan is entitled to a 17% share of revenues collected as part of Iraq's revenue sharing arrangement. The KRG argues that those funds are often not delivered.

Yet it also appears that Kurdistan is pushing for much more than merely to export oil on its own terms. Ali Balu, a former head of Iraqi parliament's oil and gas committee recently stated that within a few years "Kurdistan is going to be rid of its status as a region within Iraq," according to an article in Rudaw, a Kurdish news web site. Balu went on, "a plan is underway for Kurdistan to be an independent state in the near future."

Exporting oil from Kurdistan is a key step in the KRG's plan to eventually declare independence from Iraq. Clearly, Baghdad is not oblivious to this fact, seeing which way the winds are blowing. This is why the central government is so adamant about centralizing the oil export process. Both sides may be unwilling to give in, but the situation appears to be coming to a head, as Kurdistan expects to initiate exports within days.

Source: http://oilprice.com/Geopolitics/Middle-East/Iraqi-Government-Threatens-Action-Against-Kurds-as-Oil-Exports-Set-to-Begin.html

By. Nicholas Cunningham of Oilprice.com

© 2014 Copyright OilPrice.com- All Rights Reserved
Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.


© 2005-2022 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in