The KRG authorities have begun exporting crude oil by ship without agreement with the central government. Baghdad of asserts all sales must go through them, with the KRG's share then distributed to them from Baghdad. While the KRG asserts they have the right under the Constitution to export independently. Sorting this out is at the heart of the current political battles over the formation of the new government, but the KRG is not waiting.
The start of independent KRG seaborne exports was made possible at first in small volumes by trucking crude to ports on the Turkish Mediterranean coast. But now the real flows have begun with the opening of a new pipeline earlier this year which bypasses central government (and ISIS) controlled territory. Of course, these exports are only possible with the permission of the Turkish authorities.
There are legal disputes over purchasing the oil. Baghdad is threatening to sue buyers. There is an ongoing court battle in the US over whether companies will be allowed to purchase the crude there. Some companies made purchases back in May and June, but now are holding off, with the crude sitting offshore waiting for the legalities to be determined.
I have taken the information on ship tracking I can gather and figured out to the best of my ability where the crude has gone since May. I think it is pretty accurate. The largest known purchasers are the Israelis, having taken almost 2.5 million barrels. All the crude that has gone there has been discharged, they have not waited for any legal proceedings. The ships who delivered the crude turned off their tracking transponders (which virtually all oil tankers have) just off the coast. When they turned them back on, they were again just a little way off the coast and now were not as low in the water. Meaning they had discharged their cargoes, almost certainly at the Israeli-controlled Ashkelon refinery.
One cargo of 1 million barrels continues to sit off the shore of Morocco where it has been for over 3 months. One cargo of 600 thousand barrels was apparently delivered to the Jordanians in Aqaba for refining at the Zarqa refinery. The ship turned off its transponder near Sharm al-Sheikh, then back on a couple days later. It is possible the cargo was delivered to the Israelis who have a pipeline jointly owned with the Iranians (weird story from the Shah's era) that runs up to Ashkelon refinery in Al-Majdal on the Mediterranean coast. That would seem weird to go all the way to Aqaba though when it is easier and all the other cargoes took the much shorter journey from Turkey to Al-Majdal.
10.6 million barrels appear to have sailed since May. The destination of 37% is unknown, the Israelis have taken 23%, and the US 19%. 51% of the crude has actually been delivered, the remainder is offshore waiting for delivery, or unknown. The fact that half the crude is undelivered shows the difficulty that has been had in moving it. The Israelis are the only repeat customer who have consistently taken delivery.
I attach a chart showing this as well."
