A day before an historic vote for independent Kurdistan, the central government of Iraq issued a statement calling on "neighboring countries and countries of the world" to stop buying crude oil directly from the Kurdistan Autonomous Region and only deal with Baghdad.
The independence referendum, which is expected to produce a positive vote, raised Baghdad's hackles as soon as it was floated as an idea. The idea took quite a long time to turn into reality, what with Kurdistan's own internal political squabbles, but it did become a reality and the results should be announced on Wednesday or Thursday.
The EU, the UN, and the United States have all urged Erbil to cancel the referendum with the argument that it would distract the Kurds from the number-one regional problem: the remains of Islamic State. These urges apparently fell on deaf ears, although not everyone in Kurdistan believes that the vote actually aims to establish an independent Kurdish state, the fight for which has gone on for over a century. In fact, some political sources have suggested that it's all about control over the oil around Kirkuk and elsewhere in the autonomous region-oil that the KRG controls to the displeasure of Baghdad.
This Sunday's statement, signed by PM Haider al-Abadi, appears to be addressed mostly to Turkey, which is, ironically, the primary destination for Kurdish oil. The irony lies in the fact that Turkey's increasingly authoritarian regime is possibly the most vehement opponent of an independent Kurdish state. Related: U.S. Shale's Most Productive Play May Peak By 2021
Reuters notes in its report of the Baghdad statement that the central Iraqi government has always been opposed to the KRG trading independently in crude, and has made more than one attempt to stop this independent trade.
The Kurdistan Autonomous Region pumps around 650,000 barrels of crude daily, of which 150,000 bpd from fields around Kirkuk - fields that are the subject of a dispute between Erbil and Baghdad.
By Irina Slav for Oilprice.com
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Irina is a writer for Oilprice.com with over a decade of experience writing on the oil and gas industry. More