Iraqi Kurds' oil sale widens split with Baghdad

Published on NewsOK Modified: May 30, 2014 at 12:10 pm •  Published: May 30, 2014
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BAGHDAD (AP) — The split is growing between Iraq's central government and the Kurds after the autonomous Kurdish administration for the first time unilaterally sold oil from their region in the north, a symbolic show of economic independence from Baghdad that could build momentum for an outright break.

The Kurdish north has feuded with the Baghdad government for years over control of oil fields in the autonomous region, but it was not until January this year that the Kurds began exporting its oil to Turkey independently of the central government. A week ago, it went a step further and sold the oil itself from a Turkish port, keeping the revenues.

The Oil Ministry in Baghdad this week denounced the sale as "smuggling" and a violation of Iraq's sovereignty. Prime Minister Nouri al-Maliki called it "akin to robbery."

The Kurdish region's prime minister, Nechervan Barzani, vowed to continue sales. The region's policy "is to never take a step backward," he told Kurdish lawmakers this week. He said his government wants a solution with Baghdad, but repeated threats to hold an independence referendum in the north.

"We have other alternatives," he said. "We will not stop here."

Pro-independence sentiment has long been strong in the Kurdistan, the three-province territory in the north that is the heartland of Iraq's ethnic Kurds. But since the 2003 toppling of Saddam Hussein in a U.S.-led invasion, Kurds have largely sought to carve out a role within a federal Iraq, where they make up 20 percent of the mostly Arab population. Iraq's president is a Kurd, and Kurdish parties have joined ruling coalitions dominated by Shiite parties, despite repeated disputes over lands, resources and power-sharing.

Tensions with al-Maliki have grown sharply since the withdrawal of U.S. forces in late 2011, with Kurds accusing the Shiite prime minister of consolidating power for himself. In parliament elections earlier this month, al-Maliki gained enough seats in theory to form a coalition of Shiite parties without any Kurds.

When the Kurds began moving oil to Turkey independently in January, the Baghdad government retaliated by cutting off the 17 percent share of the state budget — some $20 billion in this year's projected budget — that is supposed to be given to the Kurdish region, creating an acute financial crisis there.

With the sale last week of nearly 1.05 million barrels of oil, "the Kurds want to end Baghdad blackmail," said Ghassan al-Attiyah, chairman of the London-based Iraq Foundation for Development and Democracy.

But the sale "further deepened the rift in a way that puts the independence of Kurdistan a matter of time and not a matter of principle anymore."

Washington warned the move could threaten Iraq's stability, saying exports should be with the appropriate approval of Baghdad. State Department spokeswoman Jen Psaki said all sides should "help the country pull together and avoid actions that might further exacerbate divisions."