PM Barzani expresses surprise over changes to oil production cost plan

"We were all expecting the parliament to vote on a draft that was agreed to by all of us – the federal government, the Kurdistan Region, and the international oil companies," the premier said in an interview during the World Economic Forum in Davos.

Kurdistan Region Prime Minister Masrour Barzani. (Photo: Designed by Kurdistan24)
Kurdistan Region Prime Minister Masrour Barzani. (Photo: Designed by Kurdistan24)

ERBIL (Kurdistan24) – Kurdistan Region Prime Minister Masrour Barzani has expressed his surprise over unexpected changes made to an approved plan for oil production costs and the Iraqi parliament's failure to vote on it this week. The delay could pose a new challenge to restarting Kurdistan Region oil exports that have been suspended for nearly two years, according to a news report from Bloomberg News.

In November, Iraq's cabinet approved a plan to allocate $16 per barrel for oil production and transportation from the Kurdistan Region. The Iraqi parliament, after two readings, was scheduled to vote on the budget on Tuesday; however, the vote was deferred following last-minute changes to the agreed-upon draft.

"We were all expecting the parliament to vote on a draft that was agreed to by all of us – the federal government, the Kurdistan Region, and the international oil companies," the premier said in an interview during the World Economic Forum in Davos. "I was very surprised that there is an alternative draft without consulting with us."

The parliamentary developments underscore ongoing disputes over oil production costs, which have stalled the full resumption of oil exports via a key pipeline that transports around 500,000 barrels per day from the Kurdistan Region to Turkey's Mediterranean port of Ceyhan.

The pipeline has been inactive since March 2023, when Turkey halted operations following an arbitration court ruling that ordered Ankara to pay Iraq $1.5 billion in damages. Turkey initially cited the need for repairs after two major earthquakes in February 2023 as the reason for the shutdown but later stated the pipeline was ready for operation, leaving the decision to resume flows in Iraq's hands.