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Established in 2006 as a Community of Reality

Welcome to the Neno's Place!

Neno's Place Established in 2006 as a Community of Reality


Neno

I can be reached by phone or text 8am-7pm cst 972-768-9772 or, once joining the board I can be reached by a (PM) Private Message.

Established in 2006 as a Community of Reality

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Established in 2006 as a Community of Reality

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    Has Iraq reached the oil-for-water stage with Türkiye?

    Rocky
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    Has Iraq reached the oil-for-water stage with Türkiye? Empty Has Iraq reached the oil-for-water stage with Türkiye?

    Post by Rocky Sun 03 Sep 2023, 5:06 am

    Has Iraq reached the oil-for-water stage with Türkiye?

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    Economy News _ Baghdad
    Last week witnessed a series of Iraqi-Turkish ministerial meetings in Baghdad and Ankara to resolve contentious issues. While Iraq is asking Turkey for facilities to obtain additional quantities of water at a time when the country is living under the impact of drought, Ankara is maneuvering to reach an agreement entitled water in exchange for oil, given that this equation carries a bad reference in the minds of the Iraqis to the oil-for-food agreement in the nineties.  
    It seems that Iraq is repeating the same experience, with a difference in the circumstances and the parties it deals with, and it is seeking to use the oil card to break through the water blockade imposed on it by its neighbors, Iran and Turkey. Turkey is taking advantage of Iraq's need for water to increase its conditions for resuming the export of Iraqi oil through its territory.  
    The visits to Baghdad by Turkish Foreign Minister Hakan Fidan, Energy Minister Alp Arslan Bayraktar, President Recep Tayyip Erdogan's special envoy for water affairs Faisal Iroglu and Iraqi Oil Minister Hayan Abdul Ghani to Ankara were part of the efforts to solve this equation, but nothing was achieved. While the exaggerated Iraqi hospitality drew attention to the guests, the Turks seemed more strict in their stances.  
    The issue of water is a major crisis in Iraq, as the country is witnessing another dry year that has caused the disappearance of lakes and marshes and the diminishing volume of water flowing through the Tigris and Euphrates rivers from the sources in Turkey and Iran.  
    This forced Iraq to take desperate measures, such as installing new pumps to extract water from the dead space in the aquifers along the two rivers. The situation is getting worse with the stopping of tributaries that originate from Iran, such as the Little Zab, whose waters Iran has stopped flowing for weeks, and with the drying up of the Euphrates River, which Iraqi officials say is now drying up before it can converge with the Tigris near Basra.  
    The Food and Agriculture Organization (FAO) in Iraq reported in July that the water level in the Euphrates River reached only 56 centimeters in Nasiriyah, causing 90 percent of the nearby marshes to dry up.  
    Ankara has not made any commitments to release more water to save communities that depend on the Euphrates River, while the International Organization for Migration says that a third of the 85,000 displaced Iraqis have moved due to water scarcity from Dhi Qar Governorate.  
    The formation of a committee in this context remains to reformulate the agreement reached by the two parties in 2021 during the administration of former Prime Minister Mustafa Al-Kazemi.  
    Iraqi official statistics indicate that the available reserves of water in reservoirs range between 7 and 7.5 billion cubic meters, out of 150 billion cubic meters of capacity. These reserves are nearing depletion, which could lead to an unprecedented catastrophe that makes even drinking water scarce.  
    This situation serves Turkey more, as the Turkish "Pinar" company for mineral water and beverage exports is looking to make Iraq its main market.  
    Iraq is working to dissuade Turkey from its strictness on the issue of water through temptations in the field of oil exports.  
    Baghdad seeks to resume oil exports from Kirkuk and the Kurdistan region through the Iraqi-Turkish pipeline. These exports have stopped since March, when Iraq won a case in the International Chamber of Commerce against Turkey regarding unilateral exports from the Kurdistan region without Baghdad's approval.  
    The loss of 450,000 barrels per day of exports for five months cost Baghdad and Erbil about $5 billion in total unrealized revenue. The liquefaction of this oil becomes, therefore, necessary to implement Iraq's budget for the year 2023, amounting to 150 billion dollars, and to curb the huge deficit of 48 billion dollars.  
    However, Turkey's direct losses are less, and range between 2 and 3 million dollars per day from oil transit fees, which enables it to overcome the missed opportunity represented in revitalizing oil and gas trade with Iraq.  
    The latest talks did not result in an agreement regarding the oil, the flow of which is controlled by Ankara. Turkish officials said they needed more time to check the pipeline and storage tanks at the Mediterranean port of Ceyhan for damage from the Feb. 6 earthquake, which analysts see as Turkish foot-dragging.  
    Omar Al-Nadawi, an analyst for Middle East affairs, says that it is difficult to believe the Turkish justifications, because the oil flow continued for 46 days after the earthquake, and stopped on March 25, hours after the International Criminal Court issued its ruling in favor of Iraq. It certainly wasn't a coincidence. Turkey adopts the Iraq pipeline as a bargaining chip to extract concessions on oil and security cooperation from Erbil and Baghdad.  
    An Iraqi oil official familiar with the talks told Reuters that reaching an agreement soon is not easy, stressing the multiplicity of thorny issues and that Turkey has demands and conditions that need more talks.  
    Reports in Iraq say that Turkey has made other difficult demands, with a demand to reduce the amount of compensation it must pay (the International Criminal Court has set an amount of $1.5 billion).  
    These include deep cuts to oil, the dropping of all cases against it, an increase in oil transportation fees to $7 per barrel (compared to a maximum of $1.18 under the current pipeline treaty, which was renewed in 2010), and reimbursement of pipeline maintenance costs.  
    Al-Nadawi notes in an analysis by the Middle East Institute that, ironically, Turkey's decision to prolong the suspension of Iraqi oil exports (whether from the federal government or the Kurdistan Regional Government) is what rearranged the interests of Baghdad and Erbil. Baghdad, for the first time in a long time, wants Erbil's oil to reach international markets as much as Erbil itself.  
    With the two governments' mutual interests at stake, and with the recent convergence in their positions on the management of oil resources, reflected in Erbil's agreement in April to allow the Iraqi State Oil Marketing Company (SOMO) to operate on its oil exports, the two parties could turn the situation in their favour.  
    Source: The London Arabs  
      
      


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