Turkey is likely to reject Baghdad’s request to resume oil exports through the port of Ceyhan today, Saturday, according to a Turkish official familiar with the matter.
Iraq’s oil minister recently said he was optimistic about oil pumping resuming over the weekend, which lifted shares of some energy companies operating in northern Iraq, including DNO and Gulf Keystone Petroleum. .
Nearly half a million barrels of oil per day, mostly from the Kurdish region of Iraq, has stopped pumping since March 25. Despite the decline in Brent futures contracts during the past month from the level of $ 76 a barrel due to concerns about the global economy, the cessation of flows through the port of Ceyhan reduced supplies to some importers in Europe.
This came after Turkey closed a pipeline extending to the port of Ceyhan from northern Iraq, as part of Ankara’s response to an international arbitral tribunal ruling that condemned it to $1.5 billion for allowing the semi-autonomous Kurdistan Regional Government to export oil through Ceyhan without obtaining Baghdad’s approval.
Iraq brought the case against Turkey to the Paris-based International Chamber of Commerce, as part of a broader effort to curb the KRG’s efforts.
Officials from Turkey, which awaits (presidential) elections on Sunday, have said they want to negotiate a settlement of the $1.5 billion before reopening the pipeline and port to Iraqi oil flows.
An Iraqi official also said that Turkey has informed Iraq that maintenance work at the port, to repair the damage caused by the recent earthquakes, is still continuing.
For his part, Genel CEO Paul Ware said: “It is very disappointing that the pipeline between Iraq and Turkey continues to be closed, and while speculation continues about the timing of the resumption of exports, we cannot predict with any certainty when exports will resume.”
The federal government in Iraq and the Kurdistan Regional Government usually export about 450 thousand barrels per day of crude oil through the port of Ceyhan, which represents about 10% of the total production of Iraq, while most of the crude is exported from the southern ports on the Persian Gulf.