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The Implications Of A Fractured U.S., Saudi Alliance

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New Kirkuk-Ceyhan Pipeline Explosion Disrupts Kurdish Production

Kirkuk Explosion

A pipeline explosion in Kirkuk caused a disruption in oil production on Wednesday, according to government sources who confirmed the source of the commotion.

"An explosion occurred in Kirkuk, which caused considerable material damage and stopped production," the Ministry of Natural Resources said in a press release. "The blast occurred, at two o'clock on Wednesday morning, along the pipeline run by authorities of the Kurdistan region which extracts oil and exports it to Turkey.”

No group has claimed responsibility for the explosion yet, although insurgents from the Islamic State (ISIS) have targeted Kurdistan’s oil infrastructure in the past.

“Flames of fire occurred on an oil pipeline passing between villages of Drkai Arab and Sartika, in Sargaran district,” Gen Sarhad Qader, head of suburban police, told Rudaw. “Attempts to put off the fire are ongoing and [authorities expect] to totally extinguish it by the evening,” he added.

The pipeline, which ends in Ceyhan, had just restarted exporting oil three days ago after being offline for scheduled maintenance.

In August last year, the central Iraqi government in Baghdad and the Kurdish Regional Government (KRG) resolved a dispute over the shipment of oil via the Ceyhan pipeline from the Kirkuk fields operated by the central government’s North Oil Company.

Related: Exxon Attempts To Maneuver Around Russian Sanctions

The shaky nature of Iraqi politics, the ISIS threat that has not been completely erased, and the generally restive region are currently deterring foreign oil companies from betting big on the Kurdish oil fields, which offer low-cost production.

Baghdad and Erbil are exempt from the terms of the Organization of Petroleum Exporting Countries’ (OPEC) deal to reduce output by 1.2 million barrels per day, though oil output from the two entities combined makes Iraq the second largest oil producer in the bloc. Saudi Arabia, the group’s de facto leader, is the largest.

By Zainab Calcuttawala for Oilprice.com

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