Iraq’s Kurdistan Regional Government (KRG) and the federal government in Baghdad have issued separate statements in the past week to present their arguments for the apparent failure of an accord on oil exports and revenue-sharing. While the latest developments highlight the difficult relationship that has prevented both sides from attaining their oil export and revenue targets, they also point to the interdependence that binds them and makes future cooperation inevitable.

The statement by the KRG’s Ministry of Natural Resources (MNR) makes no secret of the increase in independent oil sales by the semi-autonomous region and reveals a deal, concluded with oil traders in June, whereby the MNR agreed to pre-sell crude in return for a guaranteed payment of $850mn a month. (CONTINUED - 2094 WORDS)