July 7, 2020 / 4:41 PM / a month ago

Jordan says Iraq to resume oil supplies this week

AMMAN, July 7 (Reuters) - Jordan said that neighbouring Iraq expected to resume transporting crude oil over the border by truck in the next few days after Baghdad suspended supplies last week due to a steep fall in global oil prices.

Jordanian Energy Minister Hala Zawati told reporters on Tuesday that Iraqi officials had notified the Amman government they would begin loading from the Kirkuk oilfields on Wednesday, with deliveries expected to arrive at Jordan’s border on either Thursday or Friday.

Under an agreement signed last year, Iraq provides Jordan with 10,000 barrels per day, covering 7% of the country’s daily needs, Zawati said at the time.

Jordan said on July 2 that Iraq had asked to suspend supplies when oil prices went below $20 a barrel, making it uneconomic for Baghdad to sell under a price formula tied to Brent oil prices and accounting for transport and insurance costs.

“We were understanding of the Iraqi position,” Zawati said on Tuesday.

The deal was part of a broader push by Jordanian Prime Minister Omar al Razzaz to expand trade ties with his country’s eastern neighbour and press ahead with an oil pipeline project to export Iraqi crude from Jordan’s Red Sea port of Aqaba.

Zawati said she expected the oil pipeline to take three years to construct once a final agreement was signed with Baghdad. The two countries reached a preliminary agreement last year to pursue the project, estimated to cost about $5 billion. (Reporting by Suleiman Al-Khalidi; Editing by Pravin Char)

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