The oil-for-gas deal could sort out a number of internal Iraqi issues – both energy and political.
Political scrutiny of a contract is delaying a subsea pipeline project with the potential to lift export capacity by 500,000 bpd in a year.
Ankara sent a technical delegation to Baghdad but the two sides seem far from the top-level political agreement needed to restart oil flows.
New budget law appears to represent a rejection of the recent Baghdad-Erbil political deals that had sought to balance oil and financial authorities.
Upset about provisions in Iraq's draft budget law, refinery employees are shutting down tanker traffic and threatening a crippling fuel shortage.
Politicians are bristling at contractual terms that many investors demand to help protect them from the dysfunction of Iraq’s investment climate.
A subsea pipeline project could lift export capacity by 500,000 bpd in just over a year, but the funds can't be released until Iraq passes a new budget.
Last-minute additions to the budget bill could undermine a new framework for oil and financial cooperation needed to restart northern exports and support Kurdistan’s oil sector.
Baghdad has sent nearly $1 billion to Kurdistan since March, highlighting political cooperation that could grow into reliable financial flows with the passage of a new budget law.
Iraq is ready to restart pipeline exports and relieve financial pressure on the KRG, but Turkey’s delays are prompting speculation of political complications.
