Steven Sahiounie, journalist and political commentator
Iraq and the Iraqi Kurdistan Region are experiencing upheaval and crisis. In order to fully understand the issues faced, Steven Sahiounie of MidEastDiscourse interviewed Dr. Mahmoud Al-Hashemi, the Director of the Union Center for Strategic Studies, of Iraq.
1. Steven Sahiounie (SS): With the halt in oil exports from the Kurdistan Region costing Iraq over $28 billion and recent drone attacks prompting U.S. intervention, how are Erbil-Baghdad tensions reshaping the region’s political and economic stability?
Dr. Mahmoud Al-Hashemi (MAH): The persistent tendency among the political class in the Kurdistan Region of Iraq toward independence has created two major crises. The first affects the region itself in its relationship with Baghdad and neighboring countries, leaving an impact on most political, social, and economic activities. The regional governments strive to establish a model Kurdish state that draws the attention of Kurds worldwide—an ambition that is unacceptable to all parties, including the United States, as it generates regional tensions, especially with neighboring countries.
These tendencies among the leaders of the Kurdistan Region have remained unchanged even after more than two decades since the fall of the former regime. One such tendency is economic independence—an attempt to control the region’s economy without referring to the central government, taking advantage of political disputes among parties and blocs in other parts of Iraq, often visible within the Iraqi Parliament.
Until March 2023, the regional governments exported oil located within the region (northern Iraq) through contracts with production and export companies via Turkish ports, seizing the revenues without transferring them to the central treasury. This includes revenues from border crossings and other sources, while still receiving salaries for their employees from the central budget.
Although there were many objections from Iraqi political circles regarding this issue, what triggered the central government’s demand for oil exports to be conducted through SOMO (State Organization for Marketing of Oil) rather than independently was due to several reasons:
1. Laws mandate that oil exports must go through SOMO, with revenues returned to the central government. The region should receive its share through the federal budget like other parts of Iraq.
2. After the central government requested that salaries be disbursed through a banking system ("salary localization") to identify the actual number of employees, complaints emerged about a large number of fictitious names.
3. A power struggle between the ruling families in Erbil and Sulaymaniyah over oil revenues, which end up in politicians’ pockets rather than benefiting citizens. This has led to protests within the region demanding rights and confronting administrative and financial corruption.
4. A large number of citizens from the region have fled Iraq illegally, facing dangers in search of livelihood and due to restricted freedoms.
5. Oil contracts between the regional governments and extraction/export companies were made without the knowledge of the central government’s Ministry of Oil. These contracts are disproportionate, with companies receiving $16 per barrel in the region compared to $6 per barrel in central and southern Iraq.
6. The central government filed a complaint with the International Chamber of Commerce’s arbitration panel in Paris against Ankara regarding the export of crude oil from the Kurdistan Region via the Turkish port of Ceyhan, arguing that the region was exporting outside Iraq’s legal framework—and won the case.
As of now, delegations continue to shuttle between Baghdad and the region to resolve the oil export crisis, but without success. This is due to the regional government’s refusal to allow any party to review its revenue streams or impose spending mechanisms. Additionally, the companies contracted by the region for production and export have figures and contracts that differ from those recognized by the central government’s Ministry of Oil. Turkey also prefers contracts that allow it to gain more profit. Finally, the internal dispute between the Erbil and Sulaymaniyah governments contributes to skepticism about revenues and other matters.
No specific party has claimed responsibility for targeting oil sites in the region. Accusations directed at Iraqi resistance factions are unfounded, as these groups are aware of the reputational risks and potential crises such actions could cause with the central government. Moreover, they know that the presence of coalition forces in Erbil and other parts of Iraq would inevitably expose the origin of the drones, leading to reactions and complications with no benefit.
It is certain that there are parties with vested interests in targeting oil sites in the region. It is likely that these parties are internal, as many citizens of the region have confirmed they have not benefited from oil revenues. The internal power struggle within the region undoubtedly plays a role in this.
2. SS: As U.S. troops withdraw from key bases in Baghdad and Anbar, relocating to Erbil and Syria, what are the strategic implications for Iraq’s security architecture and its relationship with Iran-backed militias?
MAH: The general sentiment among the Iraqi public favors the departure of foreign forces from Iraq. The Iraqi Parliament has issued a resolution obligating the government to expel all foreign troops—not just American forces, but also Turkish troops occupying parts of northern Iraq under the pretext of pursuing the opposition Kurdistan Workers' Party (PKK).
At the same time, there is an agreement between the Iraqi government and the United States for the withdrawal of American forces from Iraq by mid-September of this year.
While some political blocs from western regions and the Kurdistan Region view the presence of these forces as a form of balance against the dominance of the Shiite majority in governance, the United States ultimately prioritizes its own interests and chooses what best serves its national agenda.
The relocation of U.S. forces to Erbil means they remain within Iraqi territory. Therefore, parties advocating for their complete withdrawal still consider their presence a violation of the agreement between Iraq and the U.S. Moreover, they argue that the continued presence of these forces in Erbil represents a strategic depth for Israel in any potential confrontation with Iraq or Iran. This raises concerns and is seen as a violation of the Iraqi constitution, which prohibits the use of Iraqi territory to launch attacks against neighboring countries.
Iraqi resistance factions firmly reject the presence of U.S. forces—not only within Iraq’s borders but across the region. These factions continue to issue statements urging the Iraqi government to maintain pressure for the complete withdrawal of these forces from all Iraqi territory.
The number of personnel in Iraq’s security forces has exceeded one million—a significant figure relative to Iraq’s population and geographic size. These forces have gained extensive experience in combating terrorism, as Iraq has fought more battles against terrorism than any other country. Given that terrorist organizations lack long-range missiles and fighter jets, Iraq’s security forces are capable of effectively managing counterterrorism operations without the need for foreign troops—especially since groups like ISIS are now fragmented and no longer pose a significant threat.
3. SS: With over 600 candidates barred from Iraq’s upcoming November elections—many due to alleged ties to the Ba’ath regime—how is this shaping public trust in the electoral process and the future of democratic governance?
MAH: The exclusion of these candidates from Iraq’s upcoming elections stems from several reasons:
1. The political shift in Syria has amplified rhetoric among certain Sunni factions—both within and outside the political process—claiming that Iraq is ripe for similar change. Some Ba'athist figures are allegedly working to restore the former regime’s authority.
2. Iraqi security forces have arrested cells affiliated with Ba'athist organizations that were actively supporting Ba'athist candidates intending to run in the upcoming elections.
3. Authorities have also apprehended Ba'athist figures who returned to Iraq months ago with plans to orchestrate regime change.
4. The Iraqi electoral law explicitly prohibits members of the dissolved Ba'ath Party from participating in elections.
These and other factors have led to the disqualification of a large number of candidates from the upcoming electoral race.
As for the impact on public trust, it’s worth noting that Iraqis have witnessed similar exclusions in previous parliamentary elections, albeit in smaller numbers. There has always been controversy surrounding the participation of former Ba'ath Party members in the political process. Moreover, many of the disqualified candidates were exposed by politicians from western regions of Iraq who viewed them as electoral rivals.
Iraq’s democratic experience is still relatively young, and political upheavals and crises have become part of its daily reality—something the Iraqi public has grown accustomed to. The dissolved Ba'ath Party no longer holds significant influence among Iraqis, who largely blame it for the country’s history of occupation, destruction, and wars.
4. SS: Recent U.S. sanctions reveal networks smuggling Iranian oil disguised as Iraqi crude—sold to Western buyers. What role do Iraqi institutions play in this scheme, and how might it affect Iraq’s international standing?
MAH: The smuggling of Iranian oil through Iraqi ports—or other ports—is a practice common among countries subjected to U.S. or international sanctions. It is extremely difficult to control, regardless of the level of surveillance, because oil is a highly demanded commodity with substantial profits. In fact, the smuggling of Iranian oil through non-Iraqi ports exceeds that through Iraqi ones. The following points are worth noting:
1. Iraqi politicians view U.S. sanctions on Iran as illegitimate and non-international. They believe there is no obligation to comply with them, even if they do not state this publicly.
2. Iraqis—especially those in central and southern regions—consider the U.S. sanctions against Iran to be unjust. They see Iran as a victim and believe that enforcing these sanctions would be tantamount to aiding the oppressor against the oppressed.
3. Due to the long border between Iraq and Iran, it is difficult to control any smuggling activity, whether it involves oil or other goods.
4. The Iraqi public is largely indifferent to U.S. sanctions, while the burden falls on the Iraqi government, which strives to curb smuggling as much as possible. Moreover, Iraq’s failure to comply with U.S. sanctions does not diminish its international standing, since these sanctions are not issued by a global authority.
5. SS: Ten months after elections, Kurdistan still lacks a functioning government due to KDP-PUK infighting. What risks does this paralysis pose for regional autonomy, and could it fracture the Kurdish political landscape?
MAH: What is happening in the Kurdistan Region regarding the delay in forming the government is a natural extension of Iraq’s broader political experience, which has yet to mature to the point of respecting constitutional deadlines and timelines.
The ongoing dispute between the two main Kurdish parties—the Kurdistan Democratic Party (KDP) in Erbil and the Patriotic Union of Kurdistan (PUK) in Sulaymaniyah—dates back to the 1970s. This conflict has been marked by numerous incidents, clashes, and even wars. The two parties also differ in political ideology: the KDP is ethnonationalist and rigid, while the PUK, composed of several leftist parties, is more open and liberal.
The post-2003 era, following the fall of the former regime and the U.S. occupation of Iraq, failed to alter these dynamics. Instead, the divisions deepened, and the interests and ambitions of both parties began to clash more intensely. Each party developed its own external alliances, which now influence its internal decisions and political direction.
One of the major issues is that Arab Iraqi parties have generally neglected the development of the political experience in the Kurdistan Region. They have left the region’s political process entirely in the hands of the ruling Kurdish parties—a serious mistake, since engaging with the region’s political affairs is essential for advancing Iraq’s overall democratic experience.
The ruling parties in the region have transferred their disputes to the Kurdish street, affecting public sentiment and monopolizing resources in a way that has left citizens suffering from restrictions on their freedoms and rights, including access to salaries and services.
If the region continues to operate in isolation without intervention or engagement from other Iraqi political forces, the divide will only widen. The region may fail to form a government before the end of the current legislative term. Day by day, the disputes deepen and media rhetoric escalates between the two sides—undoubtedly disrupting Iraq’s political process and impacting the country’s governance and future.
Steven Sahiounie is a two-time award-winning journalist.