ERBIL, Kurdistan Region of Iraq – The Iraqi parliament on Monday voted on a set of recommendations to resolve the country’s worsening fuel shortages, including directives to review the amount of white oil supplied to the Kurdistan Region.
Long queues have resurfaced at fuel stations across Iraq and the Kurdistan Region in recent weeks, with government authorities blaming the shortages on the ongoing regional conflict and difficulties in exporting and importing oil and gas derivatives.
The parliament hosted Oil Minister Basim Mohammed Khudair on Sunday to discuss the fuel crisis, during which the minister revealed that the country needs to import five million liters of gasoline daily to meet the needs of the street.
Khudair said that the country’s average daily gasoline production reached 28,857,000 liters in August, and 3,907,000 additional liters were imported, which combined is 1,776,000 liters short of the 34,540,000 liters needed for domestic consumption.
Based on the minister’s deposition, the parliament on Monday issued a set of 11 recommendations to combat the crisis, including a suggestion to reconsider a cabinet decision earlier in the year to increase the prices of oil derivatives “given its effect on fuel prices and its direct and indirect impact on transportation, production, and service costs.”
The parliament also called for devising “an urgent plan” to prevent shortages, requested the submission of a detailed report containing the cost and volume of production, consumption, and import, and directed establishing a timetable for “achieving sustainable self-sufficiency in petroleum products and reducing the need for imports.”
In November, Iraq declared self-sufficiency in the production of oil derivatives, with then-Prime Minister Mohammed Shia’ al-Sudani directing the oil ministry to halt their import.
During the Sunday parliamentary session, the oil minister asserted that Iraq’s strategic reserve was 350 million liters of gasoline prior to the regional conflict, noting that the current gasoline stockpile has reached 107 million liters.
The parliament further recommended strengthening oversight of the fuel distribution system to detect and hold accountable those involved in foul-play, and called for reviewing the oil ministry’s senior staff positions.
The fuel shortage has impacted the Kurdistan Region as well, resulting in long lines and higher prices at petrol stations.
The Iraqi parliament called for “addressing the problem of oil derivatives in the Kurdistan Region by reviewing the quantities of white oil supplied to the Region and allocating quantities of it quickly with the start of the winter season.”
The Iraqi federal government is required to send 50 million liters of white oil to the Kurdistan Region on an annual basis. The Kurdistan Regional Government (KRG) has repeatedly decried that the actual amount of white oil supplied by Baghdad has fallen significantly short of the 50 million.
Speaking to The New Region in late August, KRG natural resources ministry undersecretary Ahmed Mufti stated that Erbil is ready to send its 50,000 barrels of oil allocated for domestic consumption to Baghdad if the Iraqi government provides subsidized fuel for the Kurdistan Region.
Resuming the supply of subsidized petroleum products to farmers and agricultural workers, discussing the economic model for crude oil sales with the parliament’s Oil, Gas, and Natural Resources Committee, and directing the oil ministry to review hydrotreating contracts and exclude defaulting companies were also included in the parliament’s recommendations.
Additionally, the legislature tasked its oil and gas committee with monitoring the implementation of these recommendations and submitting periodic reports to the speaker of parliament.
The US-Iran war and the subsequent closure of the Strait of Hormuz have taken a significant toll on Iraq’s oil exports and economy, as the country ships the majority of its crude through the strategic waterway.
Baghdad has sought alternative methods to alleviate difficulties in exporting oil through the blockaded strait.