Questions remain even as Iran, Iraq resume oil swap

Iraq and Iran have reportedly begun exchanging crude oil following a 10-day halt which came after the Kurdish Regional Government (KRG) suspended the swap earlier this month.

Crude from the Kirkuk field in northern Iraq is being shipped by truck to Iran but the KRG's ministry of finance and economy ordered border crossings not to allow the passage of oil tankers into Iran as of February 15.

On Tuesday, Iraqi media reports said tanker trucks had resumed oil exports to Iran after the KRG “relaxed” a recent order that had halted the cross-border crude and fuel trade.

“After receiving a new order from the KRG Ministry of Natural Resources (MNR) on Feb. 20, border officials at the three main crossing points between Iraqi Kurdistan and Iran began letting tanker trucks through,” they said.

No reason was given for the halt but the decision came after President Donald Trump voiced discontent over KRG's oil sales to Iran last month.

After Trump's remarks, Iranian Foreign Minister Muhammad Javad Zarif visited Iraq and the semi-autonomous Kurdistan region where he said "no sanctions will affect relations between Baghdad and Tehran".

The swap deal was agreed at the end of 2017, under which Iraq was about to truck 60,000 barrels per day (bpd) of crude oil to Kermanshah in western Iran. Iraq’s southern Basra port would receive the same amount of crude from Iran either by tanker or pipeline.

Last week, KRG spokesperson Safin Dizayee was quoted as saying that the regional Kurdish government was determined to maintain economic connections with Iran.

“We will respect the relationship we have - especially since it has developed over many years - and we will never abandon it. We cannot abandon our historic connection just because of a political decision,” he said.

SS