BAGHDAD, NEW YORK: Iraq’s oil minister expressed hope on Wednesday his government can reach an agreement soon on the resumption of crude exports from the autonomous Kurdistan region to Turkiye.
Ankara stopped importing oil from Iraqi Kurdistan in March after the International Chamber of Commerce ruled the federal government in Baghdad was the only entity authorized to manage exports.
Baghdad and the Kurdish authorities in Irbil signed last month a provisional agreement establishing an export mechanism that would be supervised by the federal government, but some issues remain unresolved.
“Regarding the agreement with Iraqi Kurdistan, within a week or two maximum we will reach a final agreement for the resumption of crude exports,” Iraqi Oil Minister Hayan Abdel Ghani said, adding the indications were “positive.”
Abdel Ghani said tests had been carried out on Turkish pipelines to avoid potential oil leaks, after a deadly and devastating earthquake hit Turkiye on Feb. 6.
Under the terms of the agreement announced in April, sales of Kurdish oil are to go through the Iraqi National Oil Co., and no longer exclusively through the authorities in Iraqi Kurdistan.
In addition, revenues from Kurdish exports are to be paid into an account managed by Irbil and supervised by Baghdad.
US crude oil inventories fell for a third week in a row, while gasoline stockpiles unexpectedly rose last week as demand weakened, the Energy Information Administration said on Wednesday.
Crude inventories fell by 1.3 million barrels in the week ending April 28 to 459.6 million barrels, compared with analysts’ expectations in a Reuters poll for a 1.1-million-barrel drop.
Crude in the Strategic Petroleum Reserve declined 2 million to 364.9 million barrels, its lowest since October 1983. Levels dropped for the third week in a row as part of a congressionally mandated sale of 26 million barrels. “Overall, hydrocarbon inventories are declining at the same time that the US continues with its Strategic Petroleum Reserve release,” said Andrew Lipow, president of Lipow Oil Associates in Houston.
Gasoline stocks rose by 1.7 million barrels to 222.9 million barrels, the EIA said, compared with forecasts for a 1.2-million-barrel drop.
Demand for the motor fuel ahead of the peak summer driving season fell significantly, down 9.4 percent to 8.6 million bpd.
Crude prices extended their losses after the data showed weakness in the fuel sector.
US crude oil futures fell $2.93, or 4.1 percent, to $68.73 a barrel by 11 a.m. ET (1600 GMT). Brent crude fell $2.70, or 3.6 percent, to $72.64.
Distillate stockpiles, which include diesel and heating oil, also fell by 1.2 million barrels to 110.3 million barrels, versus expectations for a 1.1-million-barrel drop, the EIA data showed.