By Jamie Watt
Before this war, Iraq produced around 4.3 million barrels of oil a day. Estimates now put it near 1.3 million. The reason is not in Iraq. It is a channel of water at the mouth of the Gulf that this country does not control, cannot reopen, and has depended on for a century.
Nearly everything that has happened to our economy this year traces back to that stretch of sea.
First, the costs, because everyone here is living them and skipping past them would be an insult. Prime Minister Masrour Barzani told Al Jazeera this week that the Kurdistan Region has “paid a heavy price.” Trade is down 70 percent. Non-oil revenue has fallen by roughly the same. The KRG put its war losses through April at 1.5 trillion dinars, about 1.14 billion dollars. Against an agreed export of 200,000 barrels a day, the Region is currently managing about 30,000. Nobody living here needs me to tell them times are hard.
But something else happened this year, and from inside a hard season it is easy to miss.
In March, Baghdad and Erbil agreed to restart crude exports through the Iraq-Turkey Pipeline to Ceyhan. That line had sat idle for more than a decade. Shipments resumed on March 18, at 150,000 to 250,000 barrels a day. The revenue framework that unlocked it had been out of reach for years. With the southern route in doubt, the two governments settled it in weeks.
The northern door opened because the southern one closed.
For a hundred years the logic of Iraqi oil ran one direction. South to Basra, out through the Gulf, past Hormuz. Kurdistan was the end of the line, the last stop the pipeline reached. This year the map flipped, and the route everyone treated as a backup is the one carrying the country.
The gas is doing the same thing. On August 4, the operators at Khor Mor began supplying Kurdistan Region gas to Iraq’s federal Ministry of Electricity. When my family got here twelve years ago we planned our evenings around the neighborhood generator, the same as everyone else on the street. Now this Region sends fuel south to keep other people’s lights on. I still notice it when I flip a switch.
Then there is the Development Road, Iraq’s biggest infrastructure bet: roughly 1,200 kilometers of highway and rail planned from the Grand Faw port in Basra, backed by Turkey, Qatar, and the UAE. In July, in Ankara, the two countries formally launched construction of the 17 billion dollar project. The rail is still mostly blueprints, with designs about 95 percent complete, but follow the route north to where it is drawn to end. Faysh Khabur, in Duhok. The KRG has asked for a seat in decisions on the route, its revenue, and its administration. That is a much easier case to make than it was two years ago.
Americans like me grow up treating geography as fate. You have a coastline or you do not, and everything follows. Twelve years in Kurdistan have talked me out of it. A landlocked country cannot grow a coastline, but it can become the road its neighbors need, and then the port matters less than the corridor.
None of this is settled. The 1973 pipeline agreement with Turkey expired in July and Ankara wants new terms, and the strait has not reopened.
But the argument for the north is not being made in speeches anymore. It is being made in barrels of crude moving to Ceyhan, in gas moving south from Khor Mor, and in a corridor drawn to end at a Kurdish border crossing. Kurdistan spent a century as the end of Iraq’s pipeline. It is starting to look like the beginning of Iraq’s road, and after twelve years of watching this place refuse the hand it was dealt, I would not bet against it.