Kurdistan Oil Export Developments
On February 17, 2025, Jihad Hassan, a former member of the Natural Resources Committee in the Kurdistan Parliament, commented on the recent statements made by the Minister of Natural Resources regarding the anticipated resumption of oil exports from the region. Hassan characterized this potential export as a critical economic initiative that could revitalize both the local economy in Kurdistan and the broader Iraqi economy, emphasizing that the region has long been prepared for oil exports with minimal obstacles.
In addition, Kovand Sherwani, an oil expert and consultant, highlighted that the President of the Republic has signed an amendment to Article 12 of the Budget Law, which pertains to production and transportation allocations for the region’s oil. According to Sherwani, this legislative change had previously hindered oil export activities.
Sherwani stated that the amendments will take effect once published in the Official Gazette. He mentioned that a delegation from the Federal Oil Ministry had already visited the region to assess the technical aspects essential for resuming exports. This process could culminate within a week or by the end of the current month, provided that the necessary technical arrangements are completed.
While experts anticipate the gradual restart of oil exports, they caution that initial output levels will likely fall short of the previous benchmark of 400,000 barrels per day. The rehabilitation of oil wells, which have remained inactive for two years, may extend the timeframe needed to achieve prior production rates, potentially exceeding three months.
Initially, it is expected that daily exports will not dip below 250,000 barrels, with the possibility of reaching 400,000 barrels daily within a month or two. This newfound capacity promises to strengthen the public treasury, especially as this oil is deemed marketable to European markets without significant impediments.
As 2025 unfolds, the legal adjustments made to Article 12 of the Budget Law signify a pivotal step toward reinstating oil export operations from the Kurdistan region. This resolution not only addresses an essential legal hurdle obstructing exports but also presents an opportunity for the region to bolster its economic revenues by tapping into global markets, particularly in Europe.
Despite the technical challenges related to the resumption of exports, including the need for the rehabilitation of dormant oil wells, experts foresee that the export process will initiate in limited quantities, with a gradual scaling up anticipated in the months ahead.
