ERBIL, Kurdistan Region of Iraq - An oil agreement signed between Iraq and Turkey in 1973, Iraq-Turkey on oil exports, which is set to be terminated in July 2026, will not be renewed, according to a decree by Turkish President Recep Tayyip Erdogan published in the Turkish Official Gazette’s latest issue on Sunday.

The agreement was inked in 1973 and officially entered into effect in 1975. The deal has served as the framework for exporting Iraqi oil through the Ceyhan port in Turkey to international markets, where millions of barrels of oil have flown since. It has been renewed time and again ever since its conception in the 1970s.

In 2023, Ankara lost a case against Baghdad in a Paris-based arbitration court, which accused Turkey of breaching the 1973 contract between the two neighbors by allowing the Kurdistan Regional Government (KRG) to sell oil independently of Baghdad. The ruling ordered Ankara to pay $1.5 billion to Baghdad in compensation for breaching the agreement; however, Turkey responded by halting exports through its pipeline.

“Turkey-Iraq Crude Oil Pipeline Agreement dated 27/8/1973, approved by the Council of Ministers Decision dated 22/4/1975…It has been decided, under Article 3 of Presidential Decree No. 9, to terminate, as of 27/7/2026,” according to the presidential decree published by the Official Gazette.

The halt in oil exports through the Ceyhan pipeline in recent years has dealt a major blow not only to Turkey but also to Iraq and the Kurdistan Region, which have lost over 30 billion dollars in revenue to date after Baghdad won the case in Paris. 

A senior Turkish official told Reuters that the underutilization of the Iraq-Turkey pipeline is unfortunate and Ankara wants a “new and vibrant phase” to benefit both sides.

Baghdad and Erbil have engaged in numerous rounds of talks to address the issue and resume exports of Kurdish oil through the Ceyhan port, with the two governments reaching an accord in recent days that will see the KRG hand over 230,000 barrels of oil per day to Iraq’s State Organization for Marketing of Oil (SOMO) to be exported through the Ceyhan port, and reverse the halt.