Federal financial transfer signals political will to implement an agreement that could result in re-starting northern oil exports, though further hurdles remain.
The agreement will now expire in July 2026, raising new questions about the future of oil exports from northern Iraq and the Kurdistan region.
A new deal for oil and budget cooperation between Baghdad and Erbil faces significant challenges to implementation, including crippling attacks on Kurdistan's oil sector.
Drones struck Tawke and Ain Sifni on Wednesday, marking three consecutive days of attacks on Kurdistan oil fields.
Attack on HKN-operated Sarsang field coincides with the company's signing of a preliminary upstream deal with the federal Oil Ministry.
Longtime energy MP talks about U.S. pressure on Baghdad and Erbil, the blame he places on KRG oil tactics, and the upside of the sitting oil minister entering elections.
Budget transfers to Kurdistan have been frozen since May as negotiations to restart oil exports falter.
Iraq's crude sales held steady month-on-month despite minor disruptions apparently stemming from the Israel-Iran war.
A barrage of drone attacks in the past four days highlights rising security threats stemming from regional conflicts and Baghdad-Erbil political tensions.
Production and exports have not suffered major interruptions so far, but exodus of foreign oil workers and border closures highlight risks of disruption.
