Baghdad: Today’s newspapers highlight the Cabinet’s approval of a new mechanism for pricing crude oil, alongside the financial and economic reforms undertaken by the Ministry of Finance. According to National Iraqi News Agency, the Cabinet’s fifteenth regular session, chaired by Prime Minister Ali Falih al-Zaidi, adopted several sovereign decisions to restructure the economic sector and enhance export and import capacities. These decisions encompass the oil, finance, electricity, infrastructure, and international relations sectors.
Al-Sabah, published by the Iraqi Media Network, detailed the government’s measures to boost export and import capacities, including the approval of a recommendation for crude oil purchases. This recommendation stipulates that crude oil will be priced based on the State Oil Marketing Company (SOMO) or the general budget’s price, whichever is lower, with a 30% discount determined annually starting from September 1, 2026. The financial effects will be reviewed in detail, lifting subsidies on petroleum products for all sectors except those supplied to citizens, such as gasoline, gas oil, kerosene, and liquefied gas. The proposed mechanism will be presented to the Federal Board of Financial Control to adopt an amended accounting policy.
The decision also includes mechanisms for exporting Iraqi oil through specialized international and local companies. Contracts will last three months starting from September 1, 2026. Additionally, exceptional approvals to increase export and import capacities were authorized, allowing the Minister of Oil to establish additional transport routes and renew contracts. The Council approved advance payment mechanisms for oil sales and the continued payment of dues to the Basra Gas Company for products delivered to the South Gas Company.
Al-Zawraa, published by the Iraqi Journalists Syndicate, reported the Ministry of Finance’s commitment to financial and economic reforms. Minister of Finance Faleh Sari emphasized developing financial management tools to enhance Iraq’s economic resilience and achieve development goals. In a meeting with the European Union delegation, the minister discussed economic cooperation and the EU’s role in supporting reform programs.
Al-Zaman newspaper highlighted Prime Minister al-Zaidi’s directive to the Ministry of Oil to show tangible results in addressing the crude oil export crisis within a week. The Prime Minister called for contracts with international companies to market and sell oil, emphasizing Iraq’s need to diversify export routes due to the Strait of Hormuz crisis. He stressed the importance of finding solutions, stating that every unsold barrel represents a delay in state obligations.
A government source revealed that SOMO is negotiating with American and German oil shipping companies to secure crude passage through the Strait of Hormuz, capitalizing on Iranian approval for tankers flying the Iraqi flag. This move aims to ensure continued delivery of Iraqi crude to global markets amidst maritime disruptions.