Peregraf
Iraqi Prime Minister Mohammed Shia al-Sudani has given the Kurdistan Regional Government (KRG) a one-week deadline to hand over available oil, linking the release of delayed public sector salaries to the implementation of a key oil and financial agreement between Erbil and Baghdad.
According to a source familiar with Tuesday’s meeting of the Iraqi Council of Ministers, al-Sudani reaffirmed that the KRG must fulfill its obligations under the existing deal, which was designed to resolve the Kurdistan Region’s salary crisis. Under the agreement, the KRG is required to deliver 230,000 barrels of oil per day and transfer 120 billion dinars in monthly internal revenues to the federal treasury, in exchange for Baghdad covering public sector wages in the Region.
However, the KRG has told Baghdad that it cannot currently meet the oil delivery quota due to reduced production following recent drone strikes that severely damaged oil infrastructure in the Region.
Iraqi Oil Minister Hayan Abdul Ghani presented a report during the meeting detailing the current volume of available oil in the Kurdistan Region and outlining the operational impacts of the drone attacks. Despite these complications, Prime Minister Sudani emphasized the need to implement the agreement and gave the KRG one final week to comply.
The meeting did not produce a firm timeline for the disbursement of salaries. Nevertheless, federal authorities indicated that if the KRG begins to fulfill its obligations—especially regarding oil deliveries—Baghdad will proceed with transferring salaries for June, followed by those for July.
The salary crisis, has left 1.2 million of public employees in the Kurdistan Region unpaid. The situation has severely impacted the Region’s economy, eroded public trust, and placed mounting pressure on both Kurdish and federal leadership to resolve the deadlock.
Iraqi and Kurdish officials have described the oil-for-budget deal as vital to stabilizing relations between the two governments. Yet the path forward remains uncertain, as ongoing logistical challenges and political disputes continue to hinder full implementation. The coming week is expected to be decisive in determining whether relief will finally reach the Region’s long-unpaid workforce.