Iraqi Kurdish oil nears US port despite Baghdad disagreement

Iraqi Kurdish oil nears US port despite Baghdad disagreement
Sun Jul 27, 2014 13:46:07

A tanker carrying crude oil from Iraqi Kurdistan region is near the US Port of Galveston in Texas, despite Baghdad has threatened to sue anyone that buys Kurdish oil.

The ship carries approximately 1 million barrels of crude, which would fetch more than $100 million at international prices.

Any sale of Kurdish crude oil to a US refinery would infuriate Baghdad, which sees such deals as smuggling, raising questions about Washington's commitment to preventing oil sales from the autonomous region.

The Marshall Islands-flagged tanker United Kalavrvta, which left the Turkish port of Ceyhan in June carrying oil from a new Kurdish pipeline, is slated to approach the Texas port of Galveston on Saturday evening and has issued a notice of pre-arrival to ship traffic managers.

But Coast Guard Petty Officer Andy Kendrick said the ship is too large to enter the Galveston port, near Houston. That means it would have to offload its cargo onto smaller ships offshore before the oil is delivered to the US mainland.

Kendrick also said the Coast Guard was in contact with the US State Department, the National Security Council, and the Department of Homeland Security about the ship's arrival.

Trading sources in Texas, New York, London, and Geneva have been unable to identify the buyer of the United Kalavrvta's cargo. The oil could go to any one of the many refineries located along the US Gulf Coast.

The US government has expressed fears that independent oil sales from Kurdistan region could contribute to the break-up of Iraq as the government in Baghdad struggles to contain ultra-hardline Islamic State of Iraq and the Levant (ISIL).

Washington has pressured companies and governments not to buy crude from the Kurdish Regional Government (KRG), but it has stopped short of banning US firms from buying it outright.

On Thursday, Carlos Pascual, head of the US State Department's Energy Bureau, told Reuters that there had been no change of policy in Washington toward Kurdish independent oil sales, but he said he hoped the central government and the region could reach an agreement in time.


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