Hasan Turan
Former Chairman of the Turkmen Front
The Iraqi government was formed after a difficult labor and after exceeding the legal deadlines mandated by the constitution for the formation of a government, amid tense regional conditions rocking the region, and in a critical economic and security situation caused by the closure of the Strait of Hormuz and the halt of Iraqi oil exports through the Gulf, through which Iraq exports nearly 90% of its oil exports, which in turn affected Iraq’s revenues of hard currency. It also came amid a complex security situation, as numerous Iraqi sites were subjected to bombardment, and in a charged atmosphere with some neighboring countries.
It must be noted that every government formed after 2003 passed through difficult and complex stages. However, the failure to achieve any tangible progress in the overall political process in Iraq, 23 years after the fall of the regime, raises many questions and problems about the seriousness of the political system in seeking to build a state of institutions capable of dealing with the various crises rocking the region, reducing the risks facing the country, and achieving political, security, and economic stability in a tense regional and international environment that has affected most of the world’s countries.
Failing to give time, as one of the most important factors of challenge facing peoples and governments, the utmost importance, and to invest it in building institutions, is an indicator of the weak concern for the solid building of the institutions of the Iraqi state, which has led Iraq to face major and serious challenges. Because reviewing all the files in this article would require ample space, there is no harm in pausing at some of the files that concern the various segments of the Iraqi people, as evidence of the neglect by those running the country, and of their present and future repercussions on all Iraqis.
On the economic side, for example, although Iraq relies for obtaining hard currency on oil exports, which constitute most of the federal revenues and the primary resource that drives the wheel of the national economy, finance both the operational and investment budgets, and achieve a degree of stability for the Iraqi people, recent events have revealed the extent of the alarming neglect in developing this sector, despite its utmost importance. This indicates that the neglect in the other, less important sectors was far greater by comparison with the oil sector.
Despite the passage of all these years, there is no network of pipelines to transport crude oil between the available export outlets, and the closure of a single outlet reduced Iraqi exports by more than 90%.
Moreover, the strategic (Basra–Haditha) line has been out of service for more than twenty years, and the export outlets via the lines heading to Syria and the Kingdom of Saudi Arabia are completely halted. As for the Iraqi–Turkish line via Fishkhabour, it does not operate, despite the passage of nine years since the liberation of the provinces through which it passes from the control of the ISIS terrorist gangs. Export via the Region’s line is limited to the oil of the Kirkuk fields and the fields of the Region, with no available capacity to export Basra oil through it. It is worth noting that this line was used to export Kirkuk and Basra oil from the 1980s until 2003.
Despite the importance of crude oil in petrochemical industries, and the opportunity it provides Iraq to increase its economic resources by supplying the raw material needed to produce many materials in high global demand, such as fertilizers for example, and despite the existence of old petrochemical plants in Baiji and Basra, the reality points to the failure to develop this industry. Had it been invested in throughout the past years, Iraq would have achieved large economic resources, in addition to employing thousands of workers.
We also witness clear neglect in building modern refineries that would help provide petroleum derivatives such as gasoline, gas oil, and kerosene, which forces Iraq to import these derivatives annually from neighboring countries. In a scene that evokes sorrow, Iraq possesses one of the largest oil reserves in the world, yet it is forced to import petroleum derivatives and to spend hard currency on materials that could easily be produced locally, given the availability of the basic raw material, namely oil.
The file of associated gas and the available gas fields, their failure to be exploited optimally, and the continued flaring of associated gas in a way that affects the environment and the health of the residents of oil-producing areas, all against the backdrop of the continued import of gas to operate electric power stations, is one that necessitates holding accountable everyone who successively managed the Ministry of Oil, and clarifying the reasons for the failure to invest associated gas or to develop natural gas fields such as Mansouriya and Akkas, despite the passage of 23 years and the continued waste of hard currency on importing gas.
According to the World Bank, Iraq flared about 17.7 billion cubic meters of gas during 2023, or 16.3 billion cubic meters if flaring in the Kurdistan Region of Iraq, whose oil sector enjoys a degree of independence, is excluded. This placed Iraq third globally after Russia and Iran.
In addition, according to the “Global Methane Tracker” report issued by the International Energy Agency for 2025, Iraq lost an estimated additional 3.3 billion cubic meters of methane during 2024 as a result of venting, leakage, and incomplete combustion in gas flares. Thus, Iraq has the capacity to capture up to 21 billion cubic meters of additional gas, representing an opportunity for revenues estimated at about 3.8 billion dollars annually.
Had a large part of this gas been captured, Iraq could have used it to operate power-generation stations that currently run at low efficiency using fuel oil, diesel, or crude oil, in addition to generating revenues from the extracted natural gas liquids. Nevertheless, Iraq still operates its power stations below their design capacity, using polluting liquid fuel, and continues to import gas and electricity from Iran at high prices, despite the cancellation of the U.S. exemptions that had allowed it to purchase energy in February 2025.
Iraq also announced a plan to operate two floating storage units for liquefied natural gas, with the aim of beginning to import it during 2025 to increase the quantities of gas available for electricity generation. In addition to liquefied natural gas imports, Iraq currently relies on importing petrochemicals and other derivative products that could be produced locally. Developing these production capacities would not only reduce dependence on imports, but would also contribute to supporting the growth of the industrial sectors that need stable supplies of natural gas.
Until recently, Iraq had implemented only one world-class project to reduce gas flaring, namely the Basra Gas Company (BGC), which announces a processing capacity of up to about one billion standard cubic feet per day, equivalent to 10.3 billion cubic meters annually. This is a large quantity, but it falls short of the target set when the company was founded in 2011, which was equivalent to double this volume. The company also did not achieve one of its original goals, namely establishing a plant for exporting liquefied natural gas, and the three fields that feed the company still flare large quantities of gas. World Bank data indicate that they flared 5.8 billion cubic meters in 2023, while the “Capterio” company estimates this figure at about 4.6 billion cubic meters in 2024.
Moreover, the development of the oil facilities and infrastructure belonging to the ministry is still below aspirations; indeed, some of the sectors belonging to it have not undergone any real modernization, in addition to the fact that attention to training cadres has remained below the required level.
For example, the oil refinery in Kirkuk province, which still operates to this day, dates its establishment back to the late 1940s, and still relies on the technology of that era.
The Ministry of Oil also does not own any dedicated fleet for transporting crude oil, a fact revealed by reports, which deprives Iraq of a greater opportunity to benefit from its oil exports amid the rising costs of shipping through the Strait of Hormuz. By contrast, Iran owns between 45 and 60 oil tankers, and Saudi Arabia owns 83 tankers, while before 2003 Iraq owned a number of tankers dedicated to transporting crude oil.
If the neglect is evident in the oil sector, which constitutes the backbone of the Iraqi economy, then one of the most important links that also suffers from neglect is the investment of Iraq’s geographic location and its transformation into a corridor for trade and energy between the Gulf states and Europe via Turkey. The steps Iraq has taken along this path appear timid and do not rise to the level of a strategic vision aimed at diverting part of global trade toward Iraq.
Despite Iraq and Turkey signing agreements paving the way for establishing the “Development Road” that connects Iraq to Turkey, with an Emirati and Qatari presence in Baghdad, the actual tangible measures on the ground still remain stalled, and there are no real steps in this direction. It should be noted that the matter is not only about completing the Faw Port; it was also possible to develop the railway network and connect the Iraqi lines to Turkey via the (Al-Kask–Ovaköy) route, as the World Bank presented an offer to Iraq, before the fall of Bashar al-Assad’s regime, to connect the railway network in Nineveh province to the Turkish Ovaköy outlet, but the Ministry of Transport did not take any tangible steps to implement this vital project.
Turkey has also repeatedly offered Iraq to activate container trade (TIR) from Europe and Turkey to the Gulf states via the Arar outlet, and despite holding several meetings in Ankara and Baghdad, Iraqi approval was not obtained, owing to disputes over the fees collected between Baghdad and the Region. This led to the loss of an opportunity to earn millions of dollars in revenues that could have contributed to developing the infrastructure and the road network between Zakho and the Arar outlet on the Iraqi–Saudi border.
Economic opportunities do not wait long for countries; rather, they always search for alternative routes, and this is exactly what happened. Container trade shifted from the (Turkey–Iraq–Saudi Arabia) route to the (Turkey–Syria–Jordan–Saudi Arabia) route, and Syria and Jordan benefited from this shift, especially amid the closure of the Strait of Hormuz, achieving large returns from the movement of trade. There is also serious talk about establishing a railway network and pipelines to transport oil and gas, connecting Saudi Arabia and the Gulf states via the same route to Turkey and the countries of the European Union.
Continuing this approach, based on wasting available opportunities, amid a rentier economy, an inflated operational budget, and a chronic failure in managing the energy file and investing its resources, will place the current government, and any future government, before real challenges. This government in particular bears the responsibility of changing the economic course through a series of difficult but necessary measures, with the aim of reducing the effects of the crises rocking the region and turning their threats into opportunities: by finding multiple outlets for exporting energy, diversifying sources of income, benefiting from Iraq’s geographic location, and creating job opportunities for young people instead of excessive reliance on government employment, in addition to combating corruption and the economic offices that waste public money and obstruct genuine development opportunities in favor of individuals or political entities.
All those in charge of the political process must be convinced that Iraq today stands at a real crossroads amid successive crises and the neglect of vital sectors, and that rectifying the mistakes of the past is no longer an option but a national necessity, in order to catch up with the global economy, rather than remaining on its margins in the face of mounting challenges that touch various aspects of the state and society.
