Baghdad Fears US Sanctions As Kurdish Oil Export Resumption Drags

28 Feb 2025 Issue: 68 / 9 By: Yesar Al-Maleki

US threats to sanction Iraq over relations with Iran and, potentially, the non-resumption of Kurdish exports have made officials in Baghdad apprehensive. PM Sudani is pressing the oil ministry to restart flows. But Erbil-Baghdad disagreements persist, and IOCs are yet to sign new contracts. Iraq may be on a collision course with Washington.

The Iraqi government finds itself between a rock and a hard place. The new Trump administration is pressuring Baghdad to resume Kurdish oil exports through the Iraq-Turkey Pipeline (ITP) as Iraqi politicians worry they could face a wave of US sanctions as part of Washington’s ‘maximum pressure’ campaign against neighboring Iran.

Meanwhile, fellow Opec+ members are pressing Iraq to begin compensating for last year’s overproduciton as they mull their plans (MEES, 28 February), a difficult task that will be further complicated by a return of Kurdish exports through the ITP pipeline to Turkey, which could enable production from the region to increase by around 100,000 b/d. Iraq would have to cut more profitable southern exports to make room for this, hitting its already precarious financial position. (CONTINUED - 2286 WORDS)