Tensions Rise As Iraq Halts Kirkuk Oil Exports

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By Tsvetana Paraskova, Oilprice.com

Since the Iraqi army took control of the fields in the oil-rich Kirkuk area in mid-October, reports of disruptions in oil flows have been a daily occurrence, but now, according to an official at the Kirkuk provincial council, Iraq’s oil ministry has ordered a stop to all oil exports from Kirkuk’s oil fields to the Turkish Mediterranean port of Ceyhan.

“The halt is not a technical issue,” Ahmed Askari, head of the oil and gas committee at the Kirkuk Provincial Council, told Kurdish news outlet Rudaw.

“Because we have asked and it turned out there was no issue,” he added.

The reason for the decision is not clear yet, Askari told Rudaw.

Since 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, oil exports to Ceyhan from Kirkuk fields have reduced to 70,000 bpd, but now even that amount has been halted, according to Askari.

Oil production in the Kirkuk area continues at the Baba Gurgur, Khabbaz, and Jambour oil fields, but only insofar as to meet demand from local refineries, according to the official.

The North Oil Company (NOC) has stopped feeding crude oil into the export pipeline.

“The stoppage was upon the order of the Oil Ministry and we don’t know the reason,” a senior NOC official told Iraq Oil Report on Tuesday.

Since the Iraqi federal forces moved to retake fields in Kirkuk, oil flows in the Kirkuk-Ceyhan pipeline have more than halved, to some 220,000 bpd, and reports of new disruptions emerge almost every day.

Meanwhile, Iraq has boosted its oil exports from the southern Basra port by 200,000 bpd to make up for lost exports on the Kirkuk-Ceyhan route. OPEC’s second-largest producer also increased its total oil export capacity from its southern ports by 900,000 bpd to 4.6 million bpd a few days ago, after adding a new floating terminal.

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