ERBIL, Kurdistan Region of Iraq – The European Union (EU) welcomed on Wednesday the amendment to the Iraqi federal budget by the Iraqi Parliament, a move that will pave the way for the resumption of Kurdish oil exports.

 

“The adopted amendments to the budget law are a good step in that regard, but the next steps are equally important,” Anouar El-Anouni, spokesperson for the EU Foreign Affairs, told The New Region.

 

Iraqi lawmakers on Sunday passed budget amendments, paving the way for the resumption of the Kurdistan Region’s oil exports to the international market, after nearly two years of halting, the Iraqi parliament announced. 

 

The bill-turned-law calls for amending section 2C of Article 12 of the Iraqi federal budget, which states that Baghdad will reimburse Erbil for the production and transportation cost of one barrel of oil at the average cost of production and transportation of the federal oil ministry – which is valued at $6.

 

The international oil companies (IOCs) have repeatedly stated that the value set out in the budget is way lower than their expenses. The amendments would set the cost of production and transportation of a barrel of oil at $16.

 

The Kurdistan Region’s oil exports have been halted since March 2023, dealing a major blow to Iraq and the Region's economy, with over $25 billion in lost revenue to date.

 

The Kurdish and Iraqi leadership, including Iraqi Prime Minister Mohammed Shia’ al-Sudani, Kurdish PM Masrour Barzani, and Nechirvan Barzani, president of the Kurdistan Region, welcomed the budget amendments immediately, urging relevant sides in Erbil and Baghdad to kickstart technical preparations for the resumption of the oil exports.

 

A day after the budget amendments were passed, Erbil and Baghdad announced reaching an agreement to resolve outstanding financial issues, including salaries of the Kurdistan Region’s civil servants for the entirety of 2025. 

 

"A stable, functioning relation between the Iraqi Kurdish Governorate and the Federal Government in Baghdad is key for the stability and the prosperity of the country and that of the region, particularly amidst the current regional transformations,” Anouni said.

 

“The EU keeps calling for improved relations between Baghdad and Erbil,” Anouni told The New Region.