According to Reuters, Iraq cut Kirkuk oil exports to fulfill commitment agreed with OPEC and provide the fuel needed to meet local needs in light of its war against al-Islamic state. The Kurdistan region agreed with Baghdad last year on joint export giant Kirkuk oil field after reaching a preliminary agreement on revenue sharing. The Minister of Natural Resources in the Kurdistan Regional Government “Ashti Hawrami” told Reuters that in recent weeks, Iraq aside 40 – 50 thousand b/d from its stake in the Kirkuk oil to a local refinery, rather than export them to support Baghdad’s efforts to comply with OPEC’s agreement.
Iraq has not yet reached the target level to reduce its supplies to implement OPEC agreement, but Iraq surprised observers with its efforts to comply with the agreement after Baghdad opposition for a long time the idea of participating in the agreement. OPEC says that the agreement focuses on reducing production, not exports. But the Kirkuk oil staying inside Iraq rather than export it will contribute to ease the oversupply market the Mediterranean region.