At a Glance:

• Crude oil output in the Kurdistan Region has stabilized at 200,000–220,000 barrels per day (bpd).
• Only 50,000 bpd is dedicated to local refining, while the Ministry of Natural Resources (MNR) requests an increase to 115,000–126,000 bpd.
• Federal authorities charge regional refineries $16 per barrel of crude, four times the $4 per barrel rate applied to federal refineries elsewhere in Iraq.
• Regional officials are pushing for 450 IQD/liter gasoline and 5 million liters of seasonal heating kerosene to resolve local fuel shortages.

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Crude oil production in the Kurdistan Region has recovered to between 200,000 and 220,000 barrels per day (bpd), but local authorities are warning of severe domestic refined-product shortages. With the vast majority of current output routed for export alongside Kirkuk crude to Türkiye's Ceyhan port, the KRG Ministry of Natural Resources (MNR) is lobbying Baghdad to adjust internal allocation quotas and address steep disparities in crude pricing.

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Key Statements:

• Ministry of Natural Resources Statement:
  "Allowing only 50,000 bpd for regional refining fails to cover the basic fuel requirements of 2.9 million registered vehicles. We need a fair allocation share of up to 126,000 bpd alongside equitable crude pricing to ensure local market stability." — KRG Ministry of Natural Resources.

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KRG Oil Allocation & Domestic Demand

Metric / Parameter	Current Status & Figures
Daily Oil Production	200,000 – 220,000 barrels per day (bpd)
Current Domestic Allocation	50,000 bpd
Requested Domestic Allocation	115,000 – 126,000 bpd
Required Iraqi Refining Share	12.67% – 14.00% (to serve 2.9 million registered vehicles)
Crude Price to KRG Refineries	$16 per barrel
Crude Price to Federal Refineries	$4 per barrel

Efforts to Resolve Fuel Shortages

Acting Minister of Natural Resources Kamal Muhammad confirmed that formal petitions have been submitted to the Iraqi Council of Ministers to eliminate structural fuel disparities. The federal parliament has established a dedicated committee to evaluate the KRG's primary demands, which include:

• Gasoline Pricing Adjustments: Securing state-subsidized gasoline priced at 450 IQD per liter to match retail rates provided to motorists in central and southern Iraqi governorates.
• Household Heating Provisions: Securing an annual quota of 5 million liters of subsidized kerosene to ensure adequate household heating reserves ahead of winter.
• Power Sector Fueling: Directing heavy fuel oil allocations to regional power plants to prevent electricity generation drop-offs.

FYI

The dispute over internal oil allocations highlights the broader fiscal friction between Erbil and Baghdad over resource control. Even as regional field production rebounds, the $12-per-barrel surcharge imposed on local refineries forces the KRG to rely on high-cost fuel imports, complicating regional energy security until a binding federal fuel-subsidy agreement is finalized.

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