Country: Iraq Source: Enabling Peace in Iraq Center Key Takeaways:POLITICS: Iraq’s Oil Ministry Threatens Legal Action Over Oil Smuggling From the Kurdistan Region – On June 5, Iraq’s Oil Ministry said it holds the Kurdistan Regional Government (KRG) legally responsible for oil smuggling from the region and reserves the right to pursue legal action. The ministry insisted that the KRG must adhere to the constitution, Federal Supreme Court decisions, and the budget law, and hand over oil produced from fields within the region to the federal government for export and revenue collection. The new accusations come amid rising tensions between Baghdad and Erbil over the KRG’s share of the budget and new energy deals Erbil signed with foreign oil companies—deals the federal government described as “null and void.” The KRG’s Ministry of Natural Resources (MNR) dismissed the Oil Ministry’s accusations as an attempt to divert attention from Baghdad’s “failed policies” and oil smuggling operations from southern Iraq, calling the ministry’s claims “political and lacking objectivity.” The MNR further claimed that the KRG had “met its obligations in full” with regard to efforts to resume oil exports via the Iraq-Turkey pipeline, which has been halted since March 2023. It reiterated that the commercial terms of the contracts signed with oil companies operating in Kurdistan must be respected. This week, leaders of the Coordination Framework emphasized the need to pass the long-delayed Oil and Gas Law, calling it key to resolving outstanding issues between Baghdad and Erbil. Last week, the Finance Ministry froze funding to the KRG on the grounds that it had exceeded its allocation under the federal budget law and failed to meet its obligations to remit revenue from oil exports and other sources to the national treasury. Parliament Speaker Mahmoud al-Mashhadani sided with the KRG in the dispute, arguing that the Finance Ministry’s move violates the constitution and Federal Supreme Court decisions. In other developments, on June 1, Lebanese President Joseph Aoun visited Baghdad and met with Prime Minister Mohammed al-Sudani. The discussions focused on reconstruction and stabilization efforts in Lebanon, including implementation of UN Security Council Resolution 1701, as well as trade relations and cooperation in the energy and telecommunications sectors. more…SECURITY & HUMANITARIAN: More Than 800 Iraqis Return From Al-Hol; Fresh PKK-Turkey Clashes Reported in Duhok – On May 31, Iraqi authorities began repatriating 832 Iraqi nationals—comprising 223 households—from al-Hol camp in northeastern Syria, officials at the camp said. This is the 26th group of al-Hol residents (and the 10th this year) to return to Iraq under a program to repatriate all Iraqi nationals from the camp. Based on numbers previously reported by Iraqi officials, this latest transfer brings the number of returnees to approximately 15,800, leaving about 14,200 awaiting return. On June 4, local sources in Duhok province said fresh clashes erupted between the Turkish military and members of the Kurdistan Workers’ Party (PKK) near Mount Gara. The fighting set fire to swaths of farmland and forest in the area, but there were no reports of civilian casualties. These are the first reports of fighting between the PKK and Turkey inside Iraq since the PKK announced its decision last month to end its decades-long insurgency. In other developments, on May 30, eight civilians were injured when an old landmine detonated in the Penjwen district near the border with Iran. On June 2, security forces recovered a Katyusha-type rocket under the Jumhouriyah Bridge in central Baghdad. The projectile was safely disposed of, with security sources noting there was no indication the rocket was part of an attempt to target the Green Zone across the Tigris River. more…ECONOMY & CLIMATE: Iraq Announces New Tariff System; Sudani Sets New Deadline to End Gas Flaring- On June 3, Iraq’s General Customs Authority announced the implementation of a new customs tariff schedule, effective June 1, 2025. The new rules will apply to all border points, including those in the Kurdistan region. According to a statement, the tariffs—based on Cabinet Decision No. 270 of 2025—will be calculated using the actual prices of imported goods (rather than estimates), without changing the existing percentage rates. The adjustments aim to address financial discrepancies in customs declarations and invoices presented to banks for financial transactions. The move was prompted by findings from Iraq’s Anti-Money Laundering and Terrorism Financing Office and the Financial Audit Bureau. The new rules will be published at all border ports and integrated into the ASYCUDA system, which Iraq began using in January. On June 4, Prime Minister Mohammed al-Sudani said his government has set the year 2027 as the new target to completely end natural gas flaring in the oil industry—an acceleration of previous goals. Oil Minister Hayan Abdulghani had said in September 2024 that Iraq aimed to end flaring by the end of 2028. Recent statements indicate that flaring has decreased as a share of total output, from 53% in 2022 to 70% in 2025. In other developments, on June 4, Iraq’s Integrity Commission said it succeeded—assisted by Interpol—in recovering a former president of the Trade Bank of Iraq (TBI) who had been convicted in corruption cases. Former TBI chief Hamdiyah al-Jaf caused more than $1.35 billion in damages by offering interest-free loans in violation of the rules, the commission said. Previous reporting indicates that Jaf was arrested by UAE authorities in February 2023. more…