Iraq sues Turkey over Kurdish oil shipments.

Baghdad launched legal action against Ankara Friday after oil from Iraq’s autonomous Kurdish region was exported to international markets without the central government’s consent, potentially worsening already-poor ties between the neighbors.

The sudden decision to call for arbitration by Iraq, which came after shipments began on Thursday evening, is the latest move in a years-long row in which Baghdad has insisted it has the sole right to export Iraqi crude.

The dispute over the exports, which the US has said could further destabilize Iraq, also throws into doubt Prime Minister Nuri Al-Maliki’s bid for re-election after polls last month, with his campaign expected to hinge on whether or not he can secure Kurdish backing.

[tbpspa]

The central government’s oil ministry said in a statement that it has “filed a request for arbitration against the Republic of Turkey and its state-owned pipeline operator BOTAS … with the International Chamber of Commerce (ICC) in Paris.”

“By transporting and storing crude oil from Kurdistan, and by loading that crude oil onto a tanker in Ceyhan, all without the authorization of the Iraqi Ministry of Oil, Turkey and BOTAS have breached their obligations under the Iraq-Turkey Pipeline Agreement,” it said.

The ministry said it was asking the ICC to order Turkey and BOTAS to “cease all unauthorized transport, storage and loading of crude oil,” and added it was seeking financial damages of more than $ 250 million.

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