Tankers waiting nearly a month to load crude from the Kurdish region of Iraq have left the waters near the pipeline’s terminal in Turkey, an indication that oil will not leave the area anytime soon amid a standoff between the governments involved.
The vessels Neverland and Amax Anthem left the waters near Ceyhan in Turkey over the weekend without loading any crude, according to Bloomberg ship tracking and port agent reports. Three tankers chartered to carry Kurdish crude are still waiting near the port. The five ships were chartered to transport a total of about 4 million barrels of oil.
Iraq’s federal government claims the exclusive right to sell and be paid for any oil produced in the country, and for more than a decade has contested the sale of domestically produced crude to the semi-autonomous Kurdish region. Turkey halted pipeline flows from the northern fields on March 25 after an international arbitration court ruled it must pay about $1.5 billion in damages to Iraq for facilitating KRG sales through Ceyhan .
The lack of about 450,000 barrels a day of Ceyhan crude sales has reduced supply ahead of further cuts announced by producers from the Organization of the Petroleum Exporting Countries and member countries of the OPEC+ grouping. The export halt may be extended as a restart awaits the resolution of the payment dispute between Iraq and Turkey over the sales.
Iraq, OPEC’s second largest producer, exports crude from its northern fields via a pipeline to the Turkish port of Ceyhan in the Mediterranean. After jumping about $10 since the export halt and OPEC+ announcements, Brent crude is trading at about $80 a barrel.
