Jordan has approached Iraq to renew the Memorandum of Understanding (MoU) for importing crude oil, according to Minister of Energy and Mineral Resources, Saleh Kharabsheh.

From May 4 to July 30, 2023, Jordan imported approximately 5 million barrels of oil from the modern storage facility in Kirkuk, Iraq. Kharabsheh highlighted that the transportation was facilitated by both Iraqi and Jordanian tankers, ensuring a smooth flow of oil to the Jordan Petroleum Refinery Company (JPRC).

The minister emphasized that importing Iraqi crude oil aligns with the initial MoU signed between the governments of Jordan and Iraq on May 4, 2023. Under this agreement, Jordan purchases Iraqi crude oil (Kirkuk crude) at a price based on the monthly average of Brent crude oil, minus $16 per barrel. This pricing structure accounts for quality differences and transportation costs, meeting 7 percent of Jordan’s crude oil needs.

The Iraqi Cabinet has approved an increase in daily crude oil exports to Jordan, raising the quota from 10,000 barrels to 15,000 barrels starting in August 2023. These additional volumes will be transported from the Kirkuk storage facility to the JPRC in Zarqa, as reported by the Jordan News Agency, Petra. With this expansion, monthly oil exports from Iraq to Jordan have increased from 300,000 barrels to approximately 450,000 barrels, constituting around 10 percent of Jordan’s total crude oil requirements.

Kharabsheh emphasized that the MoU has been extended for an additional three months, maintaining the same terms and conditions. This extension covers the remaining undelivered volumes specified in the original agreement, ensuring a steady supply of oil. Director of Oil and Gas at the ministry, Iman Awad, noted that efforts are underway to establish a new MoU between Jordan and Iraq, further solidifying their energy cooperation.