Shafaq News / Iraq is now standing on the threshold of a new chapter of differences between Baghdad and Erbil, this time revived by the Federal Court's decision to oblige Kurdistan's Regional Government (K.R.G.) to hand over its entire oil production to the federal government.

The court's latest decision remains threatened with non-implementation amid a years-long dispute over oil resources between the federal and regional governments, especially after K.R.G. announced loud and clear that it would not be implementing it.

Kurdistan began selling oil separately from the federal government after a severe financial crisis caused by the collapse of oil prices during ISIS's invasion of Iraqi areas, as well as differences with Baghdad that prompted the latter to stop funding the regional employees' salaries.

Baghdad keeps stating that its national oil company SOMO is the only party authorized to sell Iraqi crude oil. However, each side claims that the constitution is on its side, as Iraq's oil and gas law remained stuck in the drafting phase due to differences, leaving wide enough room for maneuvers.

It is common knowledge that the oil file is one of the most prominent outstanding issues between Baghdad and Erbil.

Baghdad used to pay 453 billion Iraqi dinars (about 380 million dollars) a month in salaries to Kurdistan's employees. However, this stopped after the Region held an independence referendum, and because of Baghdad's statement that Kurdistan was not committed to delivering its oil per the federal budget terms.

After several rounds of political negotiations, Kurdistan, under an agreement with Baghdad, was obliged to deliver 250,000 barrels of crude oil produced from its fields to SOMO, and hand over revenues to the federal public treasury.

Political decision

Meanwhile, Iyad Kirkuki, a member of Kurdistan's Democratic Party (K.D.P.), stated to Shafaq News Agency, "The Federal Court's decision is a political decision aimed at pressuring Kurdistan."

He wondered, "Where has the Federal Court been since 2014 so far?" pointing out that most of the Federal Court's decisions regarding the Kurdistan Region are political.

Economic consequences..

Observers believe that the implementation of the Federal Court's decision undermines the foundations of the Region's economy on one hand, and renders it susceptible to the reverberations of the quota system on the other.

Amir Ali, a political observer, said that the implementation of the resolution would have economic consequences for Kurdistan's people because the Region has not yet recovered from the financial crisis caused by the oil decline, the cutting of its dues by the federal government during the war against ISIS, the subsequent sanctions imposed by al-Abadi's government on Erbil under the pretext of holding a popular referendum, and then by the COVID-19 pandemic.

"Citizens will be affected by this decision," Ali told Shafaq News agency.

"Political decision"

Kurdish leader Masoud Barzani stated that the Federal Supreme Court's decision on Kurdistan's oil and gas law was "purely political", unconstitutional, and is aimed at opposing the Kurdistan Region and the federal system in Iraq.

While Kurdistan's President Nechirvan Barzani said that the Federal Court's decision regarding Kurdistan's oil and gas law is unconstitutional and based on a law dating back to the time of the previous regime, noting that it cannot be implemented on the ground.

Furthermore, K.R.G. considered the recent Federal Court decision "unconstitutional" and "unacceptable." At the same time, Kurdistan's Parliament stressed that the decision was a severe blow to the Iraqi federal system, the administration of governance in Iraq, and citizenship rights.

For his part, former undersecretary of K.R.G.'s Ministry of Natural Resources, Ali Balaw, called for imposing "international guardianship" on Kurdistan, warning of a law passed by the Federal Supreme Court that puts Iraq as a state at risk.

"The Federal Court's decision to repeal the Kurdistan Oil and Gas Act, numbered 22 in 2007, is very dangerous for Iraq's future as a federal state and poses a direct threat to the Kurdistan Region," he stated in a blog post.

"The court has overstepped its powers by demolishing the foundations of building a federal state and overriding the constitution without a right," he said.

Balaw stated that the Kurdish people should pay farewell to federal Iraq and resort to international courts to recover their rights, "It is necessary to demand placing Kurdistan under international guardianship."