Turkey has taken what President Recep Tayyip Erdoğan called a "historic step" in energy cooperation with Iraq, announcing that state-owned Turkish Petroleum (TPAO) will acquire a 15 percent stake in BP Energy Company of Kirkuk Limited, the British-run operator of the Kirkuk oilfield in northern Iraq. The announcement came during a joint press conference in Ankara on Tuesday, where Erdoğan hosted Iraqi Prime Minister Ali al-Zaidi to discuss a broad range of bilateral issues including security, trade, transport, and water management.
Under the proposed framework, Iraq could supply Turkey with up to 1 million barrels of oil per day. "Once we transfer 1 million barrels of oil from our neighbour Iraq, it will meet our needs," Erdoğan said. The timing of the deal is significant: the existing Iraq-Turkey crude oil agreement — which had governed the Kirkuk-Ceyhan Oil Pipeline since 1975, moving Iraqi crude to the Turkish Mediterranean terminal of Ceyhan — expired on July 27. Rather than renew the old agreement, Ankara pushed for an entirely new energy cooperation framework.
The deal is unfolding against a volatile regional backdrop. The US-Israeli war on Iran, which began in February, effectively shut the Strait of Hormuz — the narrow waterway through which roughly a fifth of global oil and liquefied natural gas had flowed — to most international shipping. That closure disrupted Iraq's export routes and raised the strategic value of overland and pipeline alternatives through Turkey. Baghdad, under pressure to find reliable export channels, pressed Ankara to resume oil flows through the Iraq-Turkey pipeline, which had been suspended for years. Analysts note that the regional crisis has made Turkey's proposals for alternative energy and trade corridors considerably more attractive to its neighbours.
Beyond energy, the partnership carries broader strategic weight. The two countries are also engaged on security matters, most notably Turkey's military presence in northern Iraq — where Ankara maintains an estimated 50 bases of varying sizes, hosting around 5,000 troops, as part of its decades-long campaign against the Kurdistan Workers' Party (PKK), designated a terrorist organisation by Turkey, the United States, and the European Union. In mid-2025, the PKK announced its disarmament as part of a peace process with Ankara, though Turkey continues to view armed remnants in northern Iraq's mountainous terrain as a security threat. "We are in close dialogue with our Iraqi brothers to ensure that our process of a terror-free Turkey and our vision of a terror-free region become a reality," Erdoğan said.
The deal matters because it deepens interdependence between two neighbours whose relations have been complex but consequential. For Turkey, it diversifies energy supply at a moment when regional instability has made secure access to oil a pressing concern. For Iraq, it restores a critical export lifeline while anchoring Ankara as a long-term partner in security and infrastructure — including the ambitious "Development Road" project, a planned transport corridor linking Iraq's southern ports to Europe via Turkey. With the Hormuz crisis unresolved and diplomatic efforts ongoing, the Turkey-Iraq energy axis is fast becoming a pillar of regional stability.