XM does not provide services to residents of the United States of America.

Iraq's northern oil exports show few signs of restarting after stoppage

<html xmlns="http://www.w3.org/1999/xhtml"><head><title>REFILE-Iraq's northern oil exports show few signs of restarting after stoppage</title></head><body>

Refiles to fix typo in lead paragraph

By Rowena Edwards, Amina Ismail and Maha El Dahan

April 24 (Reuters) -Iraq's northern oil exports show few concrete indications of an imminent restart after a month of standstill, as aspects of an agreement between Baghdad and the Kurdistan Regional Government (KRG) have yet to be resolved, according to four sources.

Turkey halted Iraq's 450,000 barrels per day (bpd) of northern exports on March 25 after an arbitration ruling by the International Chamber of Commerce (ICC), which ordered Turkey to pay Baghdad damages of $1.5 billion for unauthorised exports by the KRG between 2014 and 2018. The pipeline had been exporting around 75,000 bpd of federal crude.

The KRG's already-fraught finances are suffering from the absence of oil revenues, two sources said.

Lost revenue from the halt for the KRG stands at over $850 million, according to Reuters estimates based on exports of 375,000 barrels per day, the KRG's historic discount against Brent crude and 31 days of outages.

Baghdad and Erbil, the capital of Iraq's semi-autonomous Kurdistan region, signed a temporary agreement on April 4 to restart northern oil exports. But the resumption of flows has seen further delays as the two governments iron out several aspects of the deal.

The KRG has agreed for Iraq's state-owned crude marketing company SOMO to market its crude, which will be restricted from heading to Asia and priced against Kirkuk official selling prices (OSPs), sources previously told Reuters.

SOMO's contracts are still under negotiation, however, and the mechanism to repay trader debts remains unclear, according to four sources familiar with discussions.

Under the April 4 agreement, KRG oil revenues will be deposited in a bank account at the Iraqi Central Bank under the control of the KRG but which Baghdad will have access to audit, two Iraqi officials have previously said.

However, details surrounding the bank account are under review including its location, which is likely to be based abroad, three separate sources told Reuters.

The KRG and SOMO are eyeing an early May export restart, two sources said, with one adding this is far from guaranteed. A restart is at least 2-3 weeks away, according to a separate industry source.

The KRG and Iraq's oil ministry did not respond to requests for comment.

Once Baghdad and Erbil reach a resolution, the restart of oil flows rests in the hands of Turkey.

Sources previously told Reuters that Turkey is seeking in-person negotiations with Baghdad relating to the $1.5 billion it was ordered to pay Iraq in damages in the arbitration case.

Turkey also wants to resolve a second arbitration case regarding unauthorised flows since 2018 before it restarts them, the sources said.

Iraq's lack of willingness to discuss these issues has frustrated Turkey, according to one source.

However, a separate KRG source said that Turkey is holding up discussions ahead of the country's upcoming presidential elections on May 14.

The Turkish energy ministry did not respond to a request for comment.

Limited storage capacity in the semi-autonomous Kurdistan region means most of its 450,000 bpd of production has been shut in.

Fields which are still running include Khurmala, which has reduced output from around 135,000 bpd to 100,000 bpd, according to a source familiar with field operations. This is feeding regional refineries and power production.

The 4,500 bpd Taq Taq field also "continues to produce into storage," according to a spokesperson at field operator Genel Energy.

Reporting by Rowena Edwards, Dmitry Zhdannikov and Julia Payne in London, Amina Ismail in Erbil, Maha El Dahan in Dubai, additional reporting by Can Sezer in Istanbul; Editing by Bernadette Baum


Disclaimer: The XM Group entities provide execution-only service and access to our Online Trading Facility, permitting a person to view and/or use the content available on or via the website, is not intended to change or expand on this, nor does it change or expand on this. Such access and use are always subject to: (i) Terms and Conditions; (ii) Risk Warnings; and (iii) Full Disclaimer. Such content is therefore provided as no more than general information. Particularly, please be aware that the contents of our Online Trading Facility are neither a solicitation, nor an offer to enter any transactions on the financial markets. Trading on any financial market involves a significant level of risk to your capital.

All material published on our Online Trading Facility is intended for educational/informational purposes only, and does not contain – nor should it be considered as containing – financial, investment tax or trading advice and recommendations; or a record of our trading prices; or an offer of, or solicitation for, a transaction in any financial instruments; or unsolicited financial promotions to you.

Any third-party content, as well as content prepared by XM, such as: opinions, news, research, analyses, prices and other information or links to third-party sites contained on this website are provided on an “as-is” basis, as general market commentary, and do not constitute investment advice. To the extent that any content is construed as investment research, you must note and accept that the content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, it would be considered as marketing communication under the relevant laws and regulations. Please ensure that you have read and understood our Notification on Non-Independent Investment. Research and Risk Warning concerning the foregoing information, which can be accessed here.

Risk Warning: Your capital is at risk. Leveraged products may not be suitable for everyone. Please consider our Risk Disclosure.