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In 2021, the KRG has sold 151 million barrels of oil, with only 25 dollars per barrel remaining, the total will be 3.8 billion dollars.

While, if the same amount of oil were exported through The Iraqi National Oil Marketing Company SOMO, it would have earned nearly three times as much revenue, in a way that would have been 10 billion dollars revenue. How? More details are available in this report.

First: The difference in the value of Kurdistan's oil; exports through SOMO or independently (before excluding expenditures)

According to the information, in 2021, the KRG has exported 151.2 million barrels of oil through the Turkish port of Jayhan. The average price of Brent oil per barrel in 2021 was 71 dollars. While the Kurdistan Region’s oil is sold for 10 dollars less than the price of crude oil, The average price of oil per barrel of KRG oil was 61 dollars. So, the KRG's total oil exported in 2021 was 9.2 billion dollars before excluding expenditures. 

But what would be the difference if the same amount of oil exported by the Kurdistan Region in 2021 was exported through the central government and the Iraqi oil marketing company SOMO?

According to the Iraqi Ministry of Oil, SOMO has sold an average 72 dollars per barrel of oil in 2021, which means the amount of oil the KRG has sold independently if it was through SOMO, would have been worth 10.3 billion dollars, according to which the Kurdistan region's oil has been sold 1.1 billion dollars cheaper than the Iraqi oil in 2021.

Second: The difference in the value of Kurdistan's oil; exports through SOMO or independently (after excluding expenditures)

According to both the KRG President and the Minister of Natural Resources, more than 58% of oil revenues are given to oil companies and oil production expenditures, in a way that 20% goes for the cost of oil production and 14% goes for the oil companies and 6% for the transportation. What remains is for the compensation of the debts.

So, after extracting the costs of the oil process and selling it for a cheaper price, only 3.8 billion dollars remains from selling 151.2 million barrels of oil, meaning that on average, only 25.62 dollars per barrel of oil has remained for the KRG during the year. 

This comes at a time when, on the same assumption as before, if the Kurdistan Region would have exported the same amount of oil through the Iraqi oil marketing company SOMO, for each barrel of oil, the KRG would have had a total of $42.76 in 2021, making it a total of 6.4 billion dollars.

In other words, instead of 3.8 billion dollars, the KRG would get about three times that amount. Which would have been 10.3 billion dollars revenue.

Oil revenue between Iraq and the Kurdistan region

According to data from the Iraqi ministry of oil in 2021, the Iraqi government exported 1.1 billion barrels of oil through the SOMO oil marketing company, which was 75.6 billion dollars.

In 2021, the Kurdistan Regional Government (KRG) exported 151.2 million barrels of oil, the revenue of the oil exported by the Kurdistan Regional Government before excluding expenditures was 10.6 billion dollars, and the remaining income for the KRG was 3.8 billion dollars.

Iraq’s oil revenue in 2021 was 75.6 billion dollars, but KRG’s oil revenue for the same year was 3.8 billion dollars. According to that, the Kurdistan region's oil sales in 2021 were 13% of Iraq's oil sales, but the KRG’s oil revenues were only 5% of Iraq's oil revenue. In other words, the Iraqi government has received 68 dollars from each barrel of oil, while the KRG has only received 25 dollars. 

Therefore, if the KRG would have handed over oil to SOMO, it would have received 43 more dollars per barrel. Also, if the KRG would have sold its oil at the price of SOMO, instead of 3 billion dollars, would have received 10 billion dollars in revenue. This means KRG lost 7 billion dollars in revenue in 2021.