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Kurdistan selling oil independent of Iraq to make up for budget deficit
7/5/2015
SLEMANI, Kurdistan region ‘Iraq’,—The chairman of the Natural Resources Committee in the Kurdistan Parliament said the Kurdistan Regional Government (KRG) decision to independently sell over 12.6 million barrels of oil in June was an attempt to solve the region’s financial crisis. Speaking on NRT’s Panorama program on Thursday, Sherko Jawdat said companies have already expressed willingness to export the region’s crude, bypassing the central government and its State Organization for Marketing of Oil (SOMO). An oil company declared that it can export 12,000 to 40,000 barrels of Kurdistan Region’s oil daily,” Jawdat said.
Officials have resorted to selling Kurdish oil independent of Baghdad to make up for a growing budget deficit, earning $750 million from sales in May alone.
Erbil’s economic issues began early in 2014 when then-Prime Minister Nouri al-Maliki stopped budget payments to the KRG over its attempts to sell its oil independent of Baghdad.
The subsequent war against the Islamic State (IS) in northern Iraq and influx of over 1.5 million displaced Iraqis and Syrian refugees added to the region’s economic troubles.
Officials from the KRG and central government struck a deal that seemed to solve the budget dispute in December 2014. Under the terms of that deal, the KRG is to export 550,000 bpd in exchange for a 17 percent share of the federal budget.
Both sides have accused the other of failing to abide by the terms of that deal, with Kurdish officials claiming Baghdad is sending less than the agreed upon payments.
Kurdish Minister of Natural Resources Ashti Hawrami told Reuters in June that the KRG has received just 35 percent of the total budget owed to it in 2015, which breaks down to nearly $1 billion per month.
Officials in Baghdad acknowledge payments transferred to Erbil have been less than what is owed, but cited country-wide budget cuts that are affecting all of Iraq’s governorates.
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7/5/2015
SLEMANI, Kurdistan region ‘Iraq’,—The chairman of the Natural Resources Committee in the Kurdistan Parliament said the Kurdistan Regional Government (KRG) decision to independently sell over 12.6 million barrels of oil in June was an attempt to solve the region’s financial crisis. Speaking on NRT’s Panorama program on Thursday, Sherko Jawdat said companies have already expressed willingness to export the region’s crude, bypassing the central government and its State Organization for Marketing of Oil (SOMO). An oil company declared that it can export 12,000 to 40,000 barrels of Kurdistan Region’s oil daily,” Jawdat said.
Officials have resorted to selling Kurdish oil independent of Baghdad to make up for a growing budget deficit, earning $750 million from sales in May alone.
Erbil’s economic issues began early in 2014 when then-Prime Minister Nouri al-Maliki stopped budget payments to the KRG over its attempts to sell its oil independent of Baghdad.
The subsequent war against the Islamic State (IS) in northern Iraq and influx of over 1.5 million displaced Iraqis and Syrian refugees added to the region’s economic troubles.
Officials from the KRG and central government struck a deal that seemed to solve the budget dispute in December 2014. Under the terms of that deal, the KRG is to export 550,000 bpd in exchange for a 17 percent share of the federal budget.
Both sides have accused the other of failing to abide by the terms of that deal, with Kurdish officials claiming Baghdad is sending less than the agreed upon payments.
Kurdish Minister of Natural Resources Ashti Hawrami told Reuters in June that the KRG has received just 35 percent of the total budget owed to it in 2015, which breaks down to nearly $1 billion per month.
Officials in Baghdad acknowledge payments transferred to Erbil have been less than what is owed, but cited country-wide budget cuts that are affecting all of Iraq’s governorates.
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