No progress has been made in long-standing talks for international oil companies to resume exporting crude from the semi-autonomous entity controlling Iraq's north to Türkiye, Iraqi Prime Minister Mohammed S. Al Sudani said on Sunday.
In a televised news conference, Al Sudani said the government is eager to resolve an impasse over prices that has halted oil exports for more than a year, Bloomberg News reported.
But he said the companies refuse to amend contracts signed years ago with the semi-autonomous, oil-rich region, controlled by Iraq's Kurdistan Regional Government (KRG).
“The companies refuse to amend, so the process stops at this point,” he said.
Earlier in March, Reuters reported that foreign companies in the KRG share responsibility for the delay in restarting crude exports, as they have failed to provide revised contracts, according to the Iraqi Oil Ministry.
The Iraq-Türkiye pipeline has been offline since March 2023, when Ankara halted flows following an arbitration ruling by the International Chamber of Commerce (ICC).
The ICC ordered Ankara to pay Baghdad damages of $1.5 billion 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. The Turkish Energy Ministry said the chamber ordered Iraq to compensate Türkiye for several violations concerning the case.
Iraq is the second-largest producer in the Organization of the Petroleum Exporting Countries (OPEC).
The country’s federal budget through next year sets an average cost for the production of each barrel at $8. But it costs $26 a barrel for the companies working in KRG, which forced the companies to halt production, Al Sudani said.
He didn’t say when discussions with the companies might resume.
Supply fears and concerns over oil prices were stoked additionally by the latest political situation in the wider region of the Middle East, including Israel's ongoing war on Gaza and the death of Iranian President Ebrahim Raisi in a helicopter crash on Sunday.
The OPEC+ grouping, consisting of OPEC members and its allies, is due to meet on June 1.
The Iraq-Türkiye oil pipeline is estimated to have handled about 0.5% of the global oil supply before the halt of the flows.
