Political upheaval in Baghdad reverberates across oil sector

In the increasingly chaotic struggle to form a new government, Iraq's oil sector has been both a political battleground and a victim of dysfunctional governance.
Supporters of Muqtada al-Sadr stage a sit-in at the Parliament building in Baghdad on Aug. 1, 2022. (WISSAM AL-OKAILI/Reuters)

BAGHDAD - Iraq is stuck in a purgatory of caretaker governance — unable to make strategic decisions in the oil sector and beyond — as political leaders in Baghdad escalate their 10-month power struggles over government formation into a new phase of street protests and civil unrest.

The most volatile rift is the intra-Shia division between the political movement led by cleric Muqtada al-Sadr and a collection of largely Iran-backed parties united under the banner of the Coordination Framework. But oil sector issues are also playing a key role in the political dynamics, and the oil sector is suffering from Baghdad's dysfunction.

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