Turkey to terminate the foundational 1975 agreement governing crude oil pipeline operations with Iraq in July 2026, according to a presidential decision published today in the country's Official Gazette. 

The move comes as the neighboring nations continue efforts to restart oil flows from an existing pipeline that has been largely dormant for over a year.

Although the announcement did not provide more details, the decision, a senior Turkish official told Reuters on Monday that the under-utilisation of an oil pipeline between Iraq and Turkey is unfortunate and Ankara is looking forward to " a new and vibrant phase" that would benefit both parties.

"A new and vibrant phase for the Iraq-Turkey Pipeline will benefit both countries and the region as a whole," the unnamed official said, adding Turkey had invested heavily in its maintenance, while repeatedly noting its importance for regional projects like the Development Road - a planned trade route involving Turkey and Iraq.

The presidential decree stated that the "Turkey-Iraq Crude Oil Pipeline Agreement," originally ratified by Turkey's government in 1973 and enacted in 1975, along with all subsequent protocols and memorandums, will cease to be in effect as of July 27, 2026. The decision did not provide a specific reason for the termination.

Turkey’s announcement adds a new layer to ongoing discussions between Ankara and Baghdad regarding the resumption of oil exports through the pipeline, which transports crude from Iraq's Kirkuk oilfields to Turkey's Mediterranean port of Ceyhan.

Oil flows through the pipeline were halted by Turkey in March 2023. This followed a ruling by the International Chamber of Commerce (ICC) ordering Ankara to pay Baghdad $1.5 billion in compensation. 

The damages were assessed for unauthorized oil exports by the Kurdistan Regional Government in northern Iraq between 2014 and 2018, which occurred without Baghdad's consent.

Turkey has indicated its readiness to resume operations, but negotiations to restart the flows encountered a new obstacle in March over disputes concerning payment mechanisms and contractual arrangements for future exports. 

The impending termination of the decades-old agreement could reshape the legal and operational framework for future energy cooperation between the two countries.