Huge losses... How does the Kurdistan region face the repercussions of the French arbitral tribunal'

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[size=52]Huge losses... How does the Kurdistan region face the repercussions of the French arbitral tribunal's decision?[/size]

[size=45]Rustam Mahmoud,
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an oil field in the Kurdistan region of Iraq.[/size]
[size=45]An official in the Kurdistan region of Iraq announced that a preliminary agreement had been reached with Baghdad to resume oil exports from the north this week, spreading a positive atmosphere regarding the possibility of finding a solution to the crisis, following the ruling of the arbitral tribunal in France regarding the export of oil.[/size]
[size=45]Before it becomes clear what will happen, the various economic sectors in the Kurdistan region are still suffering from the ruling of the body of the International Chamber of Commerce in Paris, which ruled that Turkey's export of oil extracted from the Kurdistan region is illegal through the oil pipeline that connects the region with the Turkish port of Ceyhan.[/size]
[size=45]It is expected that the economic impact and suffering will transfer to other aspects of public life in the region, and to political relations with the central government, social conditions, services, and others. The region depends mainly on oil exports as a major and almost sole source of its public resources.[/size]
[size=45]Accelerating agreements with Baghdad
Based on this, it seems that the Kurdistan region is working on more than one level, and in the forefront is the intensification of meetings with the central government, to accelerate the bilateral agreements reached between the Iraqi political forces establishing the new government, which are supposed to legitimize the export of the Kurdistan region For oil, by including this in the general budget law presented to the central parliament, which will cover the next three years, as well as approving a consensual oil and gas law, which will be the final solution to this outstanding issue between the region and the central authority.
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According to unaudited figures, stopping the export of the Kurdistan region's oil via Turkey means the region's loss of financial revenues of about 400-500 thousand barrels per day. This is something whose price, according to the current price of a barrel of oil, is about more than 25 million dollars per day, or about 750 million dollars per month at least, from which the region gets no less than 450 million dollars net, after calculating the expenses and percentages deducted for the interest of public companies in Territory.[/size]
[size=45]The nominal net loss that this cut will mean, if it continues for a full year, amounts to about $10 billion, which is the amount that will be deducted from the Iraqi budget, which must pay 12.6 percent of the general budget to the Kurdistan region, after deducting sovereign expenses. This may constitute additional burdens on the Iraqi economy, which suffers, according to the annual budget provided, a clear financial deficit. Likewise, observers are beginning to feel a decline in oil prices in the markets, which the Iraqi government has decided will be at a price of $70 per barrel.[/size]
[size=45]A political strike out of law?
Political economy researcher Stran Baghli explained, in an interview with Al-Nahar Al-Arabi, the complex nature of the effects that the law will have on both sides, whether for the central government or its counterpart in the Kurdistan region. And the central Iraqi political forces, which consider the decision as an international legal subjugation of the Kurdistan region in the interest of the center. The region, although it considers the matter as a political-legal blow to it at this critical time, several months before the adoption of the oil and gas law, which increases the power of central legislators and their aspiration to draft a law according to their central vision, and consider it conforming to the conditions of the international tribunal, but in return for that it creates a crisis Severe economic situation for the central government, stopping the oil will cancel its last arguments not to pay the region, and it actually cannot control the oil, extract it and export it from the Kurdistan region.[/size]
[size=45]Baghli adds, “The Iraqi central government’s haste to confirm its keenness to export the oil of the Kurdistan region indicates the fact that the files overlap terribly, and the inability of any party to end them with decisive tools. The decision of the international arbitral tribunal relates to the oil pipelines exported through Turkey, and not to the extraction and export of oil from the Kurdistan region. In addition, the four levels that the Commission refused to approve in the interest of the Iraqi government, clearly recognize how the oil extraction and export operations were done in the interest of the public budget of the region and its actual population. For this reason, the commission approved financial sanctions against Turkey at a rate of only 2.6 percent of what the Iraqi government demanded.[/size]
[size=45]In addition to the oil of the Kurdistan region, the Iraqi government used to export about 85,000 barrels of oil from the extracts of Kirkuk province through the same pipeline, which may create additional losses for the Iraqi government and stop many of its agreements with international companies operating there.[/size]
[size=45]Electricity Crisis
In the same context, the Ministry of Electricity in the Kurdistan Region announced a decline in the rate of power supply by 330 megawatts in the Karmian and Khurmala stations due to the cessation of oil production in the region: “Currently, in the Karmian power station, which produces energy from the gas of the Hasira oil fields, the rate of electricity has decreased by about 80%. megawatts, and at the Khormala station in Erbil, production decreased by an average of 250 megawatts.” The Norwegian company DNO, which produces 107 thousand barrels of oil per day in the fields of Tawke and Fishkhabur, announced that it had started closing its wells due to the lack of storage places, a step that other companies also took for the same reason.[/size]
[size=45]The direct moves initiated by the Kurdistan Regional Government indicated its desire for complete calm, commitment to the decisions of the international body, and pressure on the central government to expedite bilateral agreements, or to obtain a clear statement from them that legitimizes the export process de facto, but if the matter remains as it is, it will cause great damage to the economy Iraq and bilateral relations between the region and the central government.[/size]
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