Iraq will restart the export of oil from the Kurdistan Regional Government (KRG) to Türkiye after an interruption of more than two years, following what Prime Minister Mohammed S. Al Sudani called a "historic" agreement.
The deal marks a breakthrough in the deadlock and will allow around 230,000 barrels of crude a day to flow through the Iraq-Türkiye pipeline, which has been suspended since March 2023.
Under the deal, Iraq's state oil marketer SOMO will export the crude from KRG oil fields through the Kirkuk-Ceyhan pipeline to Türkiye.
The KRG said on social media platform X that the oil exports will resume within 48 hours after the tripartite agreement between Iraq's Oil Ministry, the KRG Ministry of Natural Resources and producing companies.
Flows through the Kirkuk-Ceyhan pipeline had been shut following an arbitration ruling by the International Chamber of Commerce (ICC) that Türkiye is appealing.
The ICC ordered Ankara to pay Baghdad $1.5 billion in damages over what it said were unauthorized exports by the KRG between 2014 and 2018.
Türkiye, on the other hand, said the ICC had recognized most of Ankara's demands. It has repeatedly said it's ready to restart the Kirkuk-Ceyhan pipeline.
In July, Ankara submitted a draft proposal to Baghdad to renew and broaden an energy agreement between the two countries to cover cooperation in oil, gas, petrochemicals and electricity.
U.S. Secretary of State Marco Rubio on Thursday welcomed the agreement, which he said was facilitated by Washington and would "bring tangible benefits for both Americans and Iraqis.
"We commend the decisive efforts of Iraqi Prime Minister Mohammed Shiaa al-Sudani and senior officials of the Government of Iraq, as well as KRG Prime Minister Masrour Barzani and senior KRG officials, to make this progress possible," Rubio said.
He noted that the deal would "strengthen the mutually beneficial economic partnership between the United States and Iraq, encourage a more stable investment environment throughout Iraq for U.S. companies, enhance regional energy security, and reinforce Iraq's sovereignty."
The Iraqi Oil Ministry said in a statement that it had reached an agreement to deliver all crude from KRG fields, except volumes for local use, to SOMO for export via the pipeline to Ceyhan.
The ministry did not specify when flows would restart, but a report by Reuters said they would resume as of Saturday.
Eight oil companies operating in KRG, representing over 90% of production, reached agreements in principle on Wednesday with Iraq's federal and regional governments to resume exports.
