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Kurdistan Signs $110B Oil Deals With U.S. Firms Amid Dispute With Baghdad

by Krystal

The Kurdistan Regional Government (KRG) has signed two major energy deals with U.S. companies HKN Energy and WesternZagros, Kurdish media reported on Monday. The agreements, worth a combined $110 billion, were finalized in Washington, D.C., during an official visit by KRG Prime Minister Masrour Barzani.

These deals deepen U.S. investment in Kurdistan’s oil sector, but they come amid an ongoing legal conflict with Iraq’s federal government over control of oil exports.

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Iraq’s central government has repeatedly stated that any oil contracts signed by the KRG without federal approval are illegal. In 2022, Iraq’s Supreme Court ruled that the Kurdish oil and gas law was unconstitutional and confirmed Baghdad’s authority over oil exports.

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Despite these legal rulings, the KRG continues to operate independently. The latest deals could further strain relations between Erbil and Baghdad. Analysts suggest the move may complicate negotiations and raise questions about what concessions Baghdad might seek in return.

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The Biden administration has urged all sides to restart Kurdish oil exports, which have been suspended since March 2023. The goal is to stabilize global oil markets and counter Iranian influence in the region.

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Last week, the Association of the Petroleum Industry of Kurdistan (APIKUR) called for the immediate reopening of the Iraq-Turkey pipeline. Before the current dispute, this pipeline carried Kurdish oil to the Turkish port of Ceyhan, bypassing federal authorities.

APIKUR spokesman Myles Caggins told Kurdistan24 that the group is urging Iraq’s Oil Minister to bring all stakeholders to the table following the upcoming Arab Summit.

Three of APIKUR’s eight member companies are American. They are currently working with both Baghdad and Erbil to resolve the dispute and recover around $1 billion in unpaid dues.

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