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Books on Iraq
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Update No: 054 - (25/10/07)
Unruly Kurds
The Iraqi government has decided to put the Oil Law on hold until a broader
consensus can be reached. In the meanwhile, tension between the central
government and the Kurdish provincial government continued in October as the
Kurds kept signing oil deals disregarding opposition in Baghdad. Armed with its
own oil law, the Kurdish provincial government signed in October three more
production agreements with a Canadian company (Heritage) and one with French
company Perenco. Since Baghdad threatens to exclude companies signing deals with
the Kurds from working in the rest of Iraq, it is not surprising that so far
only minor players in the oil industry signed deals in Kurdistan. The Kurds have
tried to attract the majors with attractive deals, offering 20-25% of production
for the investors (as opposed to the 15% offered to the small players), but so
far to little avail. A point of criticism is that the deals were bilateral
agreements without any transparent and open bidding. Two more deals of this kind
are said to be about to be announced. By 2012 the Kurds are planning to have
reached a 1 million bpd output. The Kurdish provincial government has also
announced plans to build two refineries, which are expected to satisfy 30-40 of
local demand for fuel. Observers comment that the vague phrasing of Iraq's
Constitution with regard to central and regional prerogatives is the ultimate
culprit of the rising confusion and tension.
Shiites more and more divided
The Kurds have room for. manoeuvre because of the multiple splits which are
riddling the central government, of which they are also a key component. Even
among the Shiites, divisions are getting stronger and stronger. The Supreme
Islamic Iraqi Council (SIIC, ex SCIRI) is intensifying its campaign in favour of
federalism, rousing the bitter opposition of Muqtada As-sadr's group. The
withdrawal of the British from Basra represents another factor stimulating the
rivalry among Shiites, with several factions competing for the control of the
city and of the lucrative oil fields. The South Oil Company is becoming the
focus of seizure attempts, with massive infiltration of clients of various
militias. Those excluded from the spoils are increasingly dismayed by the
failure of the Shiite Alliance to provide anything resembling an effective
government.
Turkish threat
The level of violence in Iraq has been diminishing over the last two months and
more markedly during the first half of October, in part possibly because of a
lull in Iran's promotion of anti-US activities. The Iranians might be trying to
show to the Americans that they can deliver peace as much as they can deliver
war. The political situation, however, remains as complicated as ever and
possibly even more so. The Sunni insurgents who are making deals with the
Americans maintain their autonomy, their weapons and their structure and are
adding to the plethora of illegal but tolerated militias which dominate much of
the country. Moreover, regional tensions are surfacing to complicate the scene.
The Kurds were in the eye of the storm in October also because of the
deteriorating relationship with Turkey. Following yet another attack by Kurdish
nationalist guerrillas within Turkey against Turkish troops, the Turkish
government started gearing up for an incursion into northern Iraq to chase the
guerrillas who escape acros the frontier. This is unacceptable to the Iraqi
Kurdish provincial government, which is vowing resistance, while the central
government is asking the Kurdish nationalist insurgents to leave Iraq, a request
very unlikely to be fulfilled. Are the Turks bluffing or will they really
invade? They have parliamentary approval from Ankara to cross the border in hot
pursuit, now at the military's discretion. Baghdad says it cannot withdraw Iraqi
troops to protect the northern borders, away from their current anti- insurgent
operations in Baghdad A limited incursion across the border is the most likely
option and during mid-October the Turkish army was already shelling border areas
of Iraq in a display of muscle.
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