Post by : Naveen Mittal

Oil Prices Decline as Iraq and Kurdish Authorities Agree to Resume Oil Exports

Oil Prices Continue Downward Trend

Oil prices experienced a fifth consecutive day of decline on September 23, 2025, as traders assessed the implications of a new agreement between Iraq and the Kurdish Regional Government (KRG). The deal will restart oil exports via a pipeline to Turkey, adding to concerns about potential oversupply in the global market.

As of early Tuesday GMT, Brent crude futures dropped by 0.63% to $66.15 per barrel, while U.S. West Texas Intermediate (WTI) crude fell by 0.58% to $61.92 per barrel. This marks a cumulative 4% loss over the past five sessions.

Resumption of Kurdish Oil Exports

The agreement between Iraq's federal government and the KRG will allow the resumption of approximately 230,000 barrels per day of oil exports through Turkey. These exports had been suspended since March 2023 due to political and logistical challenges.

The restart of the pipeline is expected to ease some of the logistical bottlenecks in the region but also raises concerns about an increase in global oil supply at a time when demand remains uncertain.

Oversupply Concerns Weigh on Market Sentiment

Market analysts note that the resumption of Kurdish oil exports adds to existing concerns about oversupply in the oil market. The International Energy Agency (IEA) has indicated that global oil supply is expected to rise more rapidly this year, with a surplus potentially expanding into 2026 as OPEC+ members increase output and supply from outside the group grows.

Traders are also monitoring other factors that could impact supply and demand dynamics, including potential European Union sanctions on Russian oil exports and geopolitical tensions in the Middle East.

Demand Outlook Remains Uncertain

While supply-side factors are influencing oil prices, demand concerns continue to weigh on market sentiment. The rise of electric vehicles and broader economic pressures are contributing to uncertainties about future oil consumption.

Preliminary U.S. data suggests rising crude inventories but falling gasoline and distillate levels, indicating a complex demand picture. Additionally, Saudi Arabia's July crude exports hit a four-month low, while Iraq has increased exports as part of the OPEC+ agreement.

Oil prices, Iraq, Kurdish Regional Government, Turkey, oversupply concerns, Brent crude, West Texas Intermediate, oil exports, energy market