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Iraq Government Condemns Kurds for ‘Illegal’ Oil Sale to Israel

Public Policy

Iraq’s government condemned the country’s semi-autonomous Kurdish authorities for “illegally” selling crude oil to Israel for the fourth time.

The SCF Altai tanker carrying crude oil from the Kurdish region docked in Ashkelon, Israel, June 20, according to an e-mailed statement from the Iraqi Oil Ministry.

The Kurdistan Regional Government also continues to smuggle crude to neighboring countries, the ministry said. Four phone calls to the KRG’s Ministry of Natural Resources weren’t answered. Israel doesn’t have diplomatic relations with OPEC’s number two producer.

The Oil Ministry said it will continue to track shipments and prosecute buyers of crude supplied by the KRG, which it said is exporting crude illegally in violation of Iraq’s constitutional accords and at discounted prices.

The KRG confirmed the sale of its second shipment by pipeline to Turkey in a statement on its website on June 20, without identifying the buyer. The KRG said its crude sales are constitutional, and that a third and fourth crude tanker are now loading with Kurdish oil in Ceyhan, Turkey.

The central government in Iraq, holder of the world’s fifth-largest crude reserves, has been in a dispute with the KRG over land and energy revenue. Kurdish Peshmerga armed forces seized the northern key oil hub, Kirkuk, after militant Islamists routed the government’s army earlier this month. The oil dispute has raised the possibility of the Kurds achieving financial self-sufficiency to go with the expanding territory.

Legal Action

Iraq’s government has initiated legal action against Turkey, taking the case to the International Chamber of Commerce in Paris. A lawsuit has also been filed domestically against the KRG’s Ministry of Natural Resources.

“The Oil Ministry reiterates a request to the Turkish government to respect the sovereignty and national resources of Iraq,” the statement said.

The SCF Altai loaded the Kurdish oil at sea from the taken United Emblem tanker, which had been denied access in Malta, according to the statement. The first tanker to have loaded crude shipped by pipeline from Iraq’s Kurdish region, United Leadership, has shut off the transponder that signals its location to avoid being tracked and remains off Moroccan waters after being denied entry to the country, the Iraqi government said.

Iraq remains technically at war with Israel since its establishment in 1948. Israel bombed Iraq’s Osirak nuclear site in 1981, and former Iraqi President Saddam Hussein’s army fired missiles at Israel during the Gulf War in 1991.

Iraq, excluding the Kurdish region, holds 150 billion barrels in proven crude reserves, the world’s fifth-biggest deposits. The KRG controls 45 billion barrels and has attracted international oil companies including Exxon Mobil Corp. (XOM) and Total SA (FP) with financial terms many investors see as more generous than those available in the rest of the country.


5 Comments on "Iraq Government Condemns Kurds for ‘Illegal’ Oil Sale to Israel"

  1. rockman on Sun, 22nd Jun 2014 9:00 am 

    Part of the dynamics: Israel exports about 25% of the refinery products it produces. Currently those products go to countries in the Med Basin. And once oil is refined the origin of that oil is lost since all the products are comingled. The Kurd refineries cannot satisfy local demand for refined products. Not difficult to anticipate an oil/product trade relationship developing between Israel and the Kurds with Turkey collecting transit fees on both sides of the deal.

    And a side note: collecting a legal judgment from a country you’ve declared war with decades ago might be a tad difficult.

  2. bobinget on Sun, 22nd Jun 2014 10:50 am 

    Iraq’s government is in no position to sue anyone much less Kurds.

    The tactic for Teheran here, demonstrate to Shias, its base…. Kurds are selling oil to LT enemy, Israel.
    See, See, how bad these Kurds are!

    All the while Sunni Muslims are pounding at Capital City gates demanding genocide.

    Why does all this reminds us of a current civil war within the US Republican Party.

    While the world, US included, faces such problems a climate change, failing infrastructure, growing class
    distinctions, race, immigration, debt, agriculture,
    peak oil, tribalism on and on. The GOP puts all its chips on denying private health care to millions of potential voters. If tactic that fails, the GOP would deny a living (minimum wage) to millions more potential voters.
    As side bets; The Grand Old Party strives to keep women pregnant and poverty stricken, in order to permit Super Rich to make their own tax laws, keep our youngest and brightest in Student Loan Hell. Top it off with minority voter suppression, even denying Republican Gays (Log Cabin) any voice to change party platforms over legal marriage between two adults of the same sex.

    Not that student loans, gay marriage, abortion, health care are not important issues, they are.

    I dare make this comparison between Tehran and Washington just to point out how all of us humans
    can’t really deal with larger issues. Folks here on these pages can because in essence, we are powerless.

  3. Fulton J. Waterloo on Sun, 22nd Jun 2014 1:10 pm 

    Actually, the US is now caught in a no-win situation because of the influence of the Israel Lobby on US politics. If the US wants to keep Iraq together, then we must discourage the Kurds from their attempts at anti-federalism. But cutting off oil to Israel would discomfort the “LOBBY.” So, maybe we should join ISIS to cause Iraq’s disintegration ; facilitating chaos and economic exploitation by Turkey and Israel. All of this a result of the 100 year fairy tale the West has been telling itself about our good intentions in the Middle East.

  4. Fishman on Mon, 23rd Jun 2014 12:39 pm 

    Now bobless, “US included, faces such problems a climate change, failing infrastructure, growing class
    distinctions, race, immigration, debt, agriculture,
    peak oil, tribalism on and on. The GOP puts all its chips on denying private health care … … to millions more potential voters.” that’s funny. You’ve been watching too much MSDNC and missed the reality outside your door. That’s obama crap and total failure. Meanwhile, the middle east crashes into caos due mainly to a failed foreign policy and the US is on the brink of another recession due to failed domestic policy. Seen any unicorns lately?

  5. Northwest Resident on Mon, 23rd Jun 2014 1:50 pm 

    Fishman — I see you’re blaming all the world’s problems on Obama, as if he has enough power and individual decision-making authority to mess things up as bad as they are. In your view, apparently, the problems we are seeing have nothing to do with oil and world resource depletion, nothing to do with the huge debt being incurred by all nations to deal with the high price of oil. Nope — it is all Obama’s fault. On top of that, you use a little trite name-calling with “bobless”. Look to me like you’re a complete simpleton, Fishman. Prove me wrong.

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