After Iraq won an arbitration case, Turkey stopped taking oil from the Kurdish area to its Ceyhan port.

A KRG spokesman said that the federal government of Iraq and the Kurdistan Regional Government (KRG) have made a first deal to get oil exports from the north back up and running this week.

"After several meetings between the KRG and the federal government, an initial agreement has been reached to resume oil exports through Ceyhan [in Turkey] this week," Lawk Ghafuri, head of foreign media affairs for the KRG, wrote on Twitter.

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"This deal will stay in place until the Iraqi Parliament approves the oil and gas law bill," Ghafuri said.

An arbitration court in Paris ruled on March 25 that Turkey had broken a 1973 agreement with Iraq by taking oil from a semi-autonomous Kurdish region without Baghdad's permission between 2014 and 2018. This meant that oil exports were stopped.

The oil was sent from the Kurdish border of Fish-Khabur to the Turkish port of Ceyhan by way of a pipeline.

HKN Energy, which is based in the United States, said in a statement last week that it would stop doing business "within a week if no solution is found."

After the court's decision last week, several companies stopped working or started storing their output. These companies included the Norwegian oil and gas company DNO and the Canadian company Forza Petroleum.

Overall, the court's decision had stopped about 0.5 percent of the world's oil supply, or about 450,000 barrels per day (bpd). Reuters says that the move did have an effect on oil prices, which went back up to almost $80.

Turkey still needs to give the go-ahead for the KRG to restart pipeline flows.

"Baghdad will send Ankara a letter asking to start sending oil again," a KRG official told Reuters.

Sources told Reuters last week that Turkey wants Iraq to settle a second case related to the 1973 agreement before the pipeline can be used again.

Iraq and its semi-autonomous region have had trouble getting oil out of the country.


In February of last year, when the Iraqi Supreme Court said that a 2007 oil and gas law that governed the KRG's oil industry was unconstitutional, tensions rose.

Mohammed Shia al-Sudani became the prime minister of Iraq in October of last year. Since then, he has been working to calm things down.

SOURCE: NEWS AGENCIES