Iraq Parliament Approves Changes in Budget Law Allowing Resumption of Kurdish Oil Shipments

iraq - Iraqi Parliament approved changes in budget law to allow Kurdish oil shipments to be managed by SOMO.

Important Development in Iraq's Oil Sector

Iraqi Parliament approved changes in the budget law, allowing the resumption of oil shipments from the Kurdistan Region of Iraq (KRI) to be managed by the State Oil Marketing Organization (SOMO). This decision comes after a temporary agreement was reached, where an international company will determine the cost of a barrel of oil within 60 days, and until then, the central government will make an advance payment of $16 per barrel to the KRI. The aim of this step is to increase transparency and cost management in the oil production process. The parliamentary approval is seen as a significant step towards resolving the two-year-long dispute in Iraq's oil exports and improving relations between Baghdad and Erbil. Following the resumption of exports, it is expected that the delays in public sector salaries will be resolved. In December, Iraqi Prime Minister Mustafa Al-Kadhimi stated that the oil crisis with the KRI has been damaging to Iraq, mentioning that they had to pay compensation to Turkey due to the halt in oil shipments via the Ceyhan pipeline.