ERBIL, Kurdistan Region - Iraq’s oil marketing agency on Friday denied reports of smuggling or blending Iraqi oil with that of neighboring countries, after United States sanctions targeted an Iraqi-linked network accused of disguising Iranian oil.
"Talk about the existence of places that allow the smuggling of Iraqi oil and blending it with the oil of neighboring countries is untrue," Ali Nizar Faiq, general director of the State Oil Marketing Organization (SOMO), told state-run Iraqi News Agency (INA).
"There are no blending or smuggling operations inside Iraqi ports or regional waters,” he added.
Last month, the US Treasury Department announced sanctions against a network accused of smuggling “billions of dollars’ worth of Iranian oil.” The sanctions target companies allegedly controlled by Iraqi-British businessman Salim Ahmed Said, who is accused of using fraudulent documentation and ship-to-ship transfers to disguise Iranian oil as Iraqi, including through blending.
“There is no evidence in any international body that confirms the existence of this kind of blending or smuggling,” Faiq said.
The sanctions are part of renewed US pressure on Iran following the reimposition of Washington’s “maximum pressure” policy in February. The July measures came shortly after a 12-day war between Iran and Israel, during which the US struck Iranian nuclear facilities.
Kurdistan Region oil exports
Faiq also said Iraq is prepared to resume oil exports from the Kurdistan Region once producing companies begin deliveries.
SOMO “has completed all preparations, and has completed contracts with the purchasing companies, and is fully prepared to start exporting oil from the region as soon as the producing companies in the region start delivering the produced quantities,” he said.
Under a recent agreement between Erbil and Baghdad, the Kurdistan Regional Government (KRG) committed to exporting its oil - about 230,000 barrels per day - through SOMO. In return, Baghdad agreed to release delayed salaries for the KRG’s public servants.
Kurdistan Region’s oil exports through the Iraq-Turkey pipeline have been halted since March 2023, when a Paris-based arbitration court ruled Ankara had violated a 1973 agreement by allowing the KRG to export oil independently starting in 2014.
Talks between Baghdad, Erbil, and international oil companies continue about a long-term framework to fully restore the Region’s exports.
