Why oil flows through the Iraq-Turkey pipeline have been halted
Here is an outline of the pipeline dispute:
WHAT IS THE LATEST?
On a visit to Erbil on Sunday, Iraqi oil minister Hayan Abdel-Ghani said he expects to reach an agreement with the Kurdistan Regional Government (KRG) and foreign oil companies to resume oil production from the Kurdish region's oilfields within three days, signalling a potential restart soon.
Turkey had said last month the pipeline was ready to begin operations, but Iraq maintained it had received no official notification over the pipeline and a senior energy adviser told Reuters Baghdad was waiting to iron out «lingering financial and technical issues» ahead of any restart.
WHY IS IT IMPORTANT?
While Iraq, OPEC's second-largest oil producer, exports about 85% of its crude via ports in the south, the northern route via Turkey still accounts for about 0.5% of global oil supply.
WHAT PROMPTED THE SHUTDOWN?
Supplies of 450,000 barrels per day (bpd) were halted on March 25 after an International Chamber of Commerce (ICC) arbitration ruling.
The ICC ordered Ankara to pay Baghdad damages of about $1.5 billion for unauthorised exports by the semi-autonomous Kurdistan Regional Government (KRG) between 2014 and 2018.
KRG exports flow through a KRG pipeline to Fish-Khabur on the northern Iraqi border, where the oil enters Turkey and is pumped to the port of Ceyhan on its Mediterranean coast.
Iraq's federal government says state-owned marketer SOMO is the only party authorised to manage crude exports via Ceyhan.
Turkey shut down the pipeline because Iraq's federal government won the right to control loading at Ceyhan.
Iraq's SOMO would have to instruct Turkey on ship-loading, or the crude would have built up in storage with nowhere to go.
Turkey halted flows
