Oil Smuggling in Kurdistan Costs Iraq $6 Billion Annually

Iraq suffers a $6 billion annual loss due to the Kurdistan Region’s oil being sold below market prices and widespread smuggling, highlighting severe economic and political issues. Meanwhile, oil revenues fail to support government needs, exacerbating public discontent.

 

According to oil expert Nabil Marsumi, Iraq is losing more than $6 billion annually due to oil smuggling and the sale of Kurdistan’s oil at prices significantly below the world market rate. Kurdfile reports that this financial hemorrhage is largely due to the Kurdistan Region’s politicized handling of its oil resources.

Marsumi explains that half of this loss stems from the Kurdistan Region selling its oil to foreign companies at a fraction of the global price. These sales bypass the federal budget, depriving Iraq of critical revenue. The other half is attributed to the smuggling of over 220,000 barrels of crude oil daily to Turkey and Iran, further exacerbating the financial drain.

This illicit trade not only violates federal regulations but also undermines Iraq’s economic stability. Critics argue that the Kurdistan Regional Government (KRG) prioritizes political gains over national interests, allowing foreign entities to exploit the region’s resources at the expense of the Iraqi people.

Kurdfile adds that Kurds would welcome the use of oil revenue to meet governmental needs. However, since 2023, not a cent has been provided to the government. Instead, all the money has been funneled to the KDP, with a small portion going to their allies in the PUK. Meanwhile, ordinary citizens receive their wages once every 90 days, sparking widespread outrage. “Isn’t this crazy?” Kurdfile exclaims, highlighting the dire need for transparency and fair distribution of resources.

Kurdfile emphasizes that the federal government must take decisive action to curb these practices. The lack of transparency and accountability in the KRG’s oil dealings continues to fuel corruption and economic disparity, calling for urgent reforms and stricter enforcement of federal laws.