Iraq is readying a newly rehabilitated pipeline that could boost its stalled exports

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An idled Iraq-Turkey pipeline link could reopen — soon? Iraq is finalizing pressure testing on an idled pipeline connected to Ceyhan in Turkey — and is saying it would start pumping crude through it soon. The pipeline, out of service since 2014 after it was damaged during fighting with ISIS, has been undergoing intense repairs over the last month.

Uh, isn’t there already a 900-km Kirkuk-Ceyhan pipeline? Yes, but this pipeline is different-ish. While the pipeline ultimately moves between the same points, it’s more of a 300-km patch that connects to the Kirkuk-Ceyhan pipeline at Iraq’s Baiji and Turkey’s Fishkhabour, effectively bypassing Kurdistan altogether. It also has more capacity at 1.6 mn bbl/d — the Kirkuk-Ceyhan now moves just 200k bbl/d.

The revived pipeline would be a boost for both Iraq and the global oil markets, but only if there are sufficient flows to take advantage of it. Before the US and Israel started bombing Iran. Iraq accounted for some 20% of crude that shipped through Hormuz — more than 90% of Iraq’s 3.3 mn bbl/d of crude exports flow through the chokepoint. Iraq is now exporting just 580k bbl/d (an average of March exports), leaving a big hole in state coffers — 90% of state revenues come from hydrocarbon exports.

More on Syria’s rehabilitation

Syria’s President Ahmed Al Sharaa met with President Sheikh Mohamed bin Zayed Al Nahyan yesterday, landing in the UAE as part of a wider Gulf tour that includes Saudi Arabia and Qatar. The readout from the meeting was light on substance.

Yesterday was Al Sharaa’s third visit to the UAE. He was in town last July and again in April. Previous talks focused on economic cooperation and encouraging more UAE firms to invest in post-Assad Syria. State-owned logistics giant DP World was among the first to do so, with a USD 800 mn agreement to develop and operate Syria’s Tartous port.

ALSO FROM SYRIA- The central government wants to clamp down on the black market for hard currency and gold by forcing trade through a now-in-the-works trading platform being built by the Central Bank of Syria.

ALSO WORTH KNOWING-

#1- The US is moving to normalize relations with Eritrea and lift the sanctions it imposed in 2021. Washington has reportedly informed allies about the plan. The move comes as geopolitical tensions and trade disruptions revive interest in the Horn of Africa and its sprawling Red Sea coasts.

#2- The Central Bank of Turkey (TCMB) leftinterest rates unchanged at 37% despite a boost to inflation thanks to fallout from the war in the Gulf. Turkey suggested it would try to avoid or delay monetary policy changes in response to inflationary pressure to avoid a slowdown, resorting instead to selling some USD 8 bn worth of gold reserves to manage the strain on its currency.