Jordan and Iraq in talks to restart oil exports to kingdom, officials say

Latest halt to the flows came after Amman helped US thwart Iranian attack on Israel

Iraqi President Abdul Latif Rashid welcomed by Jordanian King Abdullah in Amman, Jordan, April 15, 2024. Reuters

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The Amman and Baghdad governments have initiated contact to restart Iraqi oil exports to Jordan, energy officials said on Monday, after another halt in a deal long affected by political differences between the two.

The latest pause comes after Jordan drew the ire of Iran’s allies in the Middle East by helping to intercept missile and armed drone barrages on Israel last month, in rare, direct hostilities between Israel and Iran.

It also followed a joint declaration between Amman and Kuwait that supported Kuwaiti claims to a maritime area disputed by Iraq.

Jordan had been among regional players that responded positively to overtures by Shiite-dominated Iraq in the last four years to improve ties with its Arab Sunni neighbours, although plans for joint economic projects remain mostly unrealised.

A renewable, short-term agreement under which the oil flowed expired a few days ago.

A Jordanian Oil Ministry official said that “bilateral measures” are being taken by both sides to extend the deal.

“There are positive signs from the Iraqi side as far as extending the agreement,” the official said.

Ties between the two countries have soured since the Iran-backed Shiite political ascendancy that came after the fall of Saddam Hussein in 2003. Three years later, however, Iraq agreed to export 10,000 barrels per day of crude oil, at a discount, from its Kirkuk fields to Jordan, as part of a joint attempt to improve relations.

The flows, which account for 7 per cent of Jordanian oil imports, have been frequently interrupted, especially during periods of heightened political tensions. Jordan, which produces negligible volumes of oil, relies on Saudi Arabian imports for most of its crude oil needs.

A western diplomat said the latest halt was expected, given a deterioration of ties between Jordan and Tehran.

“The halt is part of an implicit Iranian threat that Jordan cannot expect to enjoy normal business exchange with Iraq,” the diplomat said.

Although Jordan depends on the US for aid and security, Amman does not publicly criticise Iran. Jordanian officials, however, privately say that Iraqi representatives cannot act on any improvement of ties with Amman without approval from Tehran.

An official with the Iraqi Oil Ministry confirmed the stoppage of oil exports to Jordan due to the agreement expiring.

He denied any political pressure or government plans to scrap the deal to sell oil at preferential prices to Jordan.

“Efforts are under way to renew the deal and it could be very soon,” an official told The National.

After a visit of Kuwait’s Emir Sheikh Meshal to Jordan late last month, both countries called on Iraq to adhere to a maritime deal that was annulled by the Iraqi Federal Supreme Court in September and to complete the delineation of the maritime border.

That has sparked anger in Iraq, mainly among Shiite lawmakers.

“I wonder, would His Highness the King [of Jordan] accept that interference in Jordan’s internal affairs?” Alia Nusaif, an Iraqi MP, said.

Ms Nusaif demanded the Iraqi government stop selling oil to Jordan and cancel a long-planned project to extend a pipeline to export oil through Jordan.

Several Iraqi politicians started collecting signatures for a petition to force the government to stop exporting oil to Jordan.