US to attend Baghdad talks in bid to curb Iranian oil exports

A worker is seen at Iraq's Majnoon oilfield near Basra, Iraq, March 31, 2021
A worker is seen at Iraq's Majnoon oilfield near Basra, Iraq, March 31, 2021

A US diplomat will attend a meeting in Baghdad Thursday focusing on resuming Kurdish oil exports via Turkey, sources told Reuters, as Washington pushes Iraq to boost global supply while curbing Iranian oil exports.

The talks, hosted by Iraq's oil ministry, come as the US increases pressure to restart the pipeline, seeking to reduce Iranian oil's market share while Iran views Iraq as a key economic lifeline.

US President Donald Trump's administration is pressuring Iraq to allow Kurdish oil exports to restart to help offset a potential fall in Iranian oil exports, Reuters reported last month, citing eight sources with direct knowledge of the matter.

In early February, Trump reinstated the so-called maximum pressure campaign on Iran from his first term, with the stated aim of pushing down Tehran's oil sales to zero.

Meanwhile, during a meeting in Tehran on Wednesday, Iran’s Oil Minister Mohsen Paknejad and Iraq’s Electricity Minister Ziyad Ali Fadel voiced their commitment to expanding energy cooperation across oil, gas, petrochemicals, and electricity sectors.

Iraq’s oil minister announced late in February that exports from the Kurdistan region would resume next week.

Sources cited by Reuters said Trump’s administration was a key force behind the announcement.

Reuters cited two US administration officials confirming that the US had asked the Iraqi government to resume Kurdish exports. One of them said the move would help dampen upward pressure on oil prices, the report added.

Iran has been a major recipient of cut-price Kurdish oil. Last July, a Reuters report detailed how the closure of the pipeline transporting Kurdish crude to Turkey in 2023 led to an increase in oil smuggling to Iran, with an estimated 200,000 barrels per day being transported by truck.

In December 2024, Reuters also reported on a fuel oil smuggling network generating at least $1 billion annually for Iran and its military allies, which had flourished in Iraq since Prime Minister Mohammed Shia al-Sudani took office in 2022.