Iraqi Pipeline Disruption Takes 250,000 Bpd Off The Market

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By Tsvetana Paraskova, Oilprice.com

Crude oil from northern Iraq, including from the Kurdistan region, stopped flowing from the oil pipeline between Kirkuk and the Turkish Mediterranean port of Ceyhan early on Monday local time, Bloomberg reports, citing a port agent.

According to a Kurdish shipping source who spoke to Reuters, the flows resumed on Monday after a technical stoppage for several hours that had completely halted the flow of crude.

The flow was still reduced to 200,000-220,000 bpd, according to the source.

The typical flow of the pipeline is some 600,000 bpd, and it has been used by both the Kurdistan Regional Government (KRG) and the central Iraqi government and its North Oil Company (NOC) for exports of crude oil from the fields in northern Iraq.

However, following the Kurdistan region’s referendum which Iraq did not recognize, Iraq’s government forces completed in mid-October an operation to seize control of all oil fields that Iraqi state-held North Oil Company operates in the oil-rich Kirkuk region from Kurdish forces. A day later, disruptions in oil flows started, with reports that the flow of crude oil from Kirkuk to Ceyhan had plummeted to some 225,000 bpd, from around 500,000 bpd the previous day.

Disruptions continued throughout the following week, and as of October 24, exports were estimated to have been down by 200,000 bpd since the beginning of the month.

In the middle of last week, Iraq’s central government started pumping oil from Kirkuk to Ceyhan, as it started exporting from the Avana field in Kirkuk via the Kurd-operated pipeline to Ceyhan. North Oil Company was then said they would also work to begin exporting from the nearby Bai Hassan oil field.

Most of Iraq’s crude oil production is shipped from the southern port of Basra, but in the north, the government must rely on the Kurdish Kirkuk-to-Ceyhan route for exports from its fields in the Kirkuk area until a pipeline that bypasses Kurdistan is repaired.

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