Iraq proposes law to buy Kurdistan oil at $16 with advance payment

BAGHDAD, — Iraq’s Oil Minister Hayan Abdul Ghani said on Monday that a draft law has been submitted to parliament outlining the federal government’s plan to handle oil revenues from the Kurdistan Region, including an advance payment of $16 per barrel.

Speaking to the Iraqi News Agency (INA), Abdul Ghani explained that the proposal includes provisions for the Kurdistan Regional Government (KRG) to supply between 250,000 and 300,000 barrels of oil per day for export via the state-run Iraqi Oil Marketing Company (SOMO).

“The draft law is currently under parliamentary review,” Abdul Ghani said. “This arrangement will remain in place until the costs of gas investment in oil-producing fields within the region are reassessed.”

He also addressed global oil prices, stating that crude oil is trading between $70 and $80 per barrel. “We are optimistic that prices will remain stable or see slight increases, ensuring Iraq has adequate resources for its state budget,” he added.

Meanwhile, tensions have emerged between the federal government and the KRG over the implementation of budgetary provisions related to oil exports. Federal government spokesperson Basem Al-Awadi refuted allegations made by the KRG that Baghdad was obstructing amendments to articles concerning oil exports in the federal budget.

In a statement issued Monday, Al-Awadi stressed the importance of the KRG complying with the Federal General Budget Law and the rulings of Iraq’s Federal Supreme Court.

“The regional government must deliver all financial revenues, including oil and non-oil revenues, to the federal government as mandated by law,” he said.

Al-Awadi urged parliament to move quickly in approving the draft amendment prepared by the Council of Ministers, emphasizing that it is in the nation’s best interest to resolve disputes over oil and financial coordination.

The Kurdistan Region has been accused of smuggling 400,000 barrels of oil every day. A Kurdish lawmaker from the Barzani’s Kurdistan Democratic Party (KDP) in the Iraqi parliament has denied these claims, calling the numbers exaggerated.

“We don’t deny that oil smuggling happens in the region,” said MP Shakhawan Doberdani on Sunday. “But it’s not at the level of 350,000 barrels per day as claimed.”

The issue of oil revenues has long been a point of contention between Baghdad and Erbil. While the federal government seeks greater control over oil exports, the KRG has called for increased autonomy in managing its natural resources.