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Iraq signed a deal to resume oil exports via Turkey, circumventing the Strait of Hormuz and contributing to a drop in oil prices. The agreement resolves long-standing disputes and is expected to provide a new route for global oil supply.

Iraq-Kurdistan Pipeline Dispute Resolved

Oil prices dipped as Iraq signed a deal to resume oil exports via Turkey, providing an alternative route that bypasses the Strait of Hormuz. This agreement helps resolve long-standing issues between the Iraqi government and the Kurdistan region regarding pipeline fees and oil revenue distribution. Previously, these disputes led to a shut-in of approximately 75% of oil production from northern Iraqi fields. The deal is expected to allow the export of about half a million barrels a day through this route.

Bypassing Hormuz and Market Impact

This agreement is significant as it secures an export route directly to Turkey's Mediterranean port of Ceyhan, avoiding the Strait of Hormuz. This offers a crucial alternative amid security concerns in Gulf energy sites, which have faced attacks from Iran-linked militias. With the Strait of Hormuz currently blocked, this new route enables Iraq to supply oil to international markets, potentially reducing global oil price volatility and easing supply concerns.

*Source: YouTube: Bloomberg (2026-03-18)*

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