Iraq’s Kurdistan Shipping Oil And Refined Products To Iran

Tanker trucks carrying oil and refined products from Kurdistan to Iran

Since the New York Times exposed the Kurdistan Regional Government’s (KRG) longtime shipment of oil products to Iran in July 2010, Kurdish authorities have repeatedly said that only refined products are going to Iran, that it is all legal, and that any crude oil from the region would only go through pipelines controlled by the central government. In August however, a reporter from National Public Radio (NPR) went to the Kurdistan border and interviewed truck drivers waiting to cross over to Iran who said that they were carrying not only oil derivatives like fuel and gas, but also oil.

Kelly McEvers from NPR went to a border crossing point between the KRG and Iran and interviewed some of the trucks drivers lined up there. One said that he was carrying refined products, while another stated that his tanker was full of crude. Most said that they were heading to Iranian ports along the Persian Gulf, and had no idea where their cargos were going afterward. All said they were working for private companies. A member of the Change List accused the ruling Kurdistan Democratic Party (KDP) and Patriotic Union of Kurdistan (PUK) of being behind the trade. A spokesman for the KRG responded that the regional government sold surplus oil to private companies, and they could do what they wanted with it afterward. He acknowledged that some smuggling was going on with Iran, but that was a small operation and was not official KRG policy. The report contradicted earlier statements by Kurdistan officials. Before they denied that any oil was going to Iran. Other stories also noted that the truck drivers filled up at government run facilities and got their travel directions there as well, and KRG Natural Resource Minister admitted that the profits were going into government run accounts.

The slew of news articles about the Kurds’ activities this year have exposed their long standing smuggling to Iran. In the 1990s Kurdistan first began sending oil to Iran since they had friendly relations with Tehran, having fought on their side during the Iran-Iraq War in the 1980s, and to earn money independently from Baghdad that was controlled by their archenemy Saddam Hussein. After the 2003 invasion, the KRG began signing its own oil deals, started operating two oil fields, and claimed that it had the right to explore and export its own crude. The Oil Ministry objected to all of these moves and called them illegal. As a result of being shut out of the government run pipelines, the KRG decided to continue on with their smuggling operations to Iran, once again motivated by the fact that it provided revenue not controlled by Baghdad. They were able to do this rather quietly until the New York Times article this summer.

All the press since then has brought up questions about the KRG’s activities, but it will not stop them. First, some have questioned whether the trade with Iran violates United Nations and U.S. sanctions on Iran that were just passed this year. Second, it re-ignites the dispute between the central and regional governments over who has authority over oil sales. Third, it brings up the lack of transparency within Kurdistan and Iraq in general, which has no real accounting for its oil industry, and the profits it generates. Last, it has increased internal tensions within the KRG between the ruling parties and the opposition who have accused the latter of corruption and running the region as their own personal fiefdom. Despite all this controversy, none of it is going to stop the shipments to Iran because no one can deter the Kurds from doing so right now. Baghdad has no control over the border in Kurdistan, and the U.S. wants to support Iraq so it will turn a blind eye to the KRG’s activities.

SOURCES

Dagher, Sam, “Smugglers in Iraq Blunt Sanctions Against Tehran,” New York Times, 7/8/10

International Crisis Group, “Oil For Soil: Toward A Grand Bargain On Iraq And The Kurds,” 10/28/08

Majid, Kamal, “An Assessment of the conditions in the Kurdish part of Iraq,” Brussels Tribunal.org, 7/23/08

McEvers, Kelly, “Flow Of Oil From Iraq To Iran Raises Concerns,” NPR, 8/13/10

Muhammad, Sardar, “KRG presidential candidates,” Niqash, 7/9/09

El-Tablawy, Tarek and Barzanji, Yahya, “Oil smuggling to Iran embarrassment for Iraq,” Associated Press, 7/13/10