On the 15^th of October 2017 the Iraqi Army forced its way into the Kurdish stronghold of Kirkuk. U.S.-armed and -trained Iraqi government forces clashed with U.S.-armed and -trained Kurdish forces in Kirkuk. By Monday, Iraqi forces had reclaimed the city, a military base, the airport, and major oil fields nearby while thousands of Kirkuk Kurdish residents fled north. This was a direct result of including Kurdish voters in Kirkuk to participate in the Kurdistan independence referendum when the ‘official’ control of Kirkuk (and its oil wells) had not been agreed with the Iraqi central government or with the many ethnic groups which inhabit Kirkuk; especially the Turkmen.  Kurdish forces affiliated with the Patriotic Union of Kurdistan (‘PUK’) gained full security and military control over Kirkuk after June 2014, when the Iraqi army’s 12th division withdrew in the face of the Islamic State's overwhelming advance.

Iraq's Turkmens hope opposition to the recent Kurdish independence referendum will help them strengthen their political presence and keep the Kurds from annexing Kirkuk. Turkmens are the third-largest ethnic group in Iraq and say they have been denied their rights since Saddam Hussein was overthrown as president in 2003. Part of the problem is the deep sectarian conflict between Sunni and Shiite Turkmens that kept them from forming unified political blocs. When the new regime based on sectarian and ethnic quotas was established in Iraq, the Turkmens lacked the political experience of the Shiites and Kurds. The Turkmens have been involved in sectarian strife in many areas, particularly in Tal Afar, reaching the point of military clashes.[i]

Elements from a combined force of Iraqi Security Forces (ISF), Counterterrorism Services (CTS), Federal Police, and Iranian-backed popular mobilization forces (PMF) south of Kirkuk City launched a probing attack against Peshmerga forces southwest of Kirkuk at 2:00 a.m. on October 15th. The Iranian-backed units include the Badr Organization’s Turkmen Brigade (the 16th PMU brigade) and three brigades from Asai’b Ahl al-Haq (the 41st, 42nd and 43rd PMU brigades). Barzani ordered the outmatched Kurdish Peshmerga forces not to engage with the Iraqi troops but to move out of Kirkuk. Some small militias defied this order but they we soon overwhelmed. Barzani realises that he was able to move towards independence because of the failure of the Iraqi Government to deal with the Daesh crisis in Mosul and Kirkuk. In June 2014, Daesh seized the second biggest Iraqi city, Mosul, just 80 km from Irbil when the Iraqi army deserted northern Iraq and the Kurdish army (the Peshmerga) took hold of Kirkuk and other disputed territories outside of the constitutional borders of the official Kurdistan region. In July 2014 Barzani called for an electoral commission to be formed to prepare a referendum on the region’s independence, citing the central authorities’ weakness. In the face of the Peshmerga’s successful efforts to fight Daesh in the region and in an effort to attract support from the mainly-Sunni tribes, Maliki’s successor, Haidar al-Abadi, eased the anti-Kurdish rhetoric of his predecessor. But he also resisted the growing risk of Iraq’s disintegration and acted against Kurdish independence. This was of particular concern as the Kurdish Reginal Government (‘KRG’) referendum plan included ethnically mixed disputed territories controlled by the Kurds, which raised fears within these communities of annexation and raised the possibility of localized armed conflict on an ethnic basis., especially if it included territory (like Kirkuk) which wasn’t normally considered part of Kurdistan.

Northern Iraq

There was disunity among the Kurds as well. The legality of Barzani’s right to call this referendum was challenged by many Kurdish politicians. Barzani’s mandate ended on August 19, 2015 but he remained as acting president. In that capacity he established the referendum by executive decree on June 8, 2017., This did not garner the support of the other Kurdish political parties. Only the Kurdistan Islamic Union (KIU) supported the referendum. The Patriotic Union of Kurdistan (PUK), which is the KRG’s second-largest party, divided on whether to support it, while the Gorran Movement and the smaller Kurdistan Islamic Group (KIG) have opposed it. After a two-year hiatus, only 68 out of 110 members from the KDP, the KIU, and part of the PUK bloc attended the opening session of the Kurdistan parliament on September 15, 2017 when the referendum was agreed. The Kurdish political parties accuse Barzani and his KDP of using the referendum as an issue to divert attention from the economic and political problems of the Kurdistan region. Since 2014, the region has been in an economic crisis caused by low oil prices and subsequently growing debt. It is estimated that more than half of the region’s population works in the public sphere, but their salaries have been recently cut by over 50% and are months overdue. From October 2015 to August 2017, the regional parliament had not reconvened. The KDP’s relationship with the central government in Baghdad is equally as conflicted.

There is another group in the region which has a powerful stake in the battle for control of Kirkuk and the region; the Sunni tribes of Northern Iraq. With the rise of an Iraqi Government after Saddam dominated by Shia forces under Al-Maliki the Sunni tribes initially sided with Daesh and refused to help the central government in their anti-Sunni efforts. When the excesses of Daesh became apparent and after the fate of the Yazidi was known, the Iraqi government was able to get some limited support from the Sunni tribes in the fight against Daesh. The victories over Daesh in Mosul and the retaking of Kirkuk by the Peshmerga has energised the Sunni tribal leadership to seek their autonomy from the Iraqi central government. Sunni forces in Iraq are working on advancing their project to establish an autonomous Sunni region. Sunnis want to use the Kurdish referendum as an opportunity to achieve autonomy in their provinces as well. A spokesman for Arab tribes in Ninevah province, Mouzahem al-Huwait, talked about the call to form a Sunni region during a TV show on an Israeli channel Oct. 3. He said, “Arab Sunnis are facing killings and displacement, and the government has offered them nothing while they were displaced.”[ii]

The project to establish a purely Sunni region in northern and western Iraq is not new. On June 30, 2011, then-Iraqi parliament Speaker Osama al-Nujaifi talked about Sunni independence and the formation of a Sunni region. Calls increased by the end of 2011 to create an independent region in the Sunni provinces of Diyala, Salahuddin and Anbar. The government was given a 14-day deadline to meet a series of demands.  In 2012, Iraqi Sunnis also called for independence from Iraq and the establishment of an independent region in the Sunni areas. Members of the Mosul provincial council considered back in 2014 that Qatar and Saudi Arabia will give their blessing to the announcement of the Mosul region when the time is right. Barzani has sought to make alliances with the Sunni tribes, promising them autonomy within Kurdish autonomy; a move which has also generated an anti-independence party among the Sunni tribes; especially in Anjar The Iraqi Constitution stipulates the right to establish regions based in accordance with its provisions and with the approval of the federal government. However, the Kurdish moves toward independence on a nationalist basis and the Sunni leaders’ call for a western region on a sectarian basis will likely encourage Shiites in the centre and south to call for the establishment of the Basra region on a sectarian basis also. Such calls would also push Christians to demand a Christian region in the Ninevah Plains on a religious basis. These moves would destroy the identity of the Iraqi state in place since 1921 and raise the concerns of neighbouring countries that fear the trend towards division would reach their own territories.[iii]

The Economic Background to Kurdish Autonomy

There are three problematic issues in the region’s relations with the central government in Baghdad: Kurdistan’s share of the federal budget, its production and sale of hydrocarbon resources, and the status of disputed territories (defined by Art. 140 of the constitution- lands that had been Arabised under Ba’ath party rule, including oil-rich Kirkuk, in 2014 were seized by the Peshmerga but are inhabited half by the Kurds and half by Turkmen, Arab and other minorities). According to the constitution, the central government is to administer the sales of Iraqi oil, while redistributing a share of the revenues to the provinces, including 17% to the Kurdish region. Iraqi Kurdistan, together with Kirkuk, is home to some 40% of Iraqi oil, which the Kurds have been distributing via Turkey without Baghdad’s involvement. At least since 2012, the KRG has conducted an independent energy policy. The earnings on the export of oil from the region make up most of the shortfall in revenues from the central government which has cut back revenues to the KRG. Now, with most of Iraq ‘Daesh-Free’ the Iraqi government is keen to reopen its pipeline from Kirkuk to the Turkish port of Ceyhan.

Iraq’s oil minister, Jabar al‐Luaibi, announced that preparations to begin the process of restoring and reopening the Kirkuk‐Ceyhan pipeline are going to start now that “the area has been cleared of “terrorist gangs.” He stated that he had asked North Oil Company, the State Company for Oil Projects (SCOP), and Iraq’s state pipeline company to restore the pipeline to full operation. Iraq hopes to restore exports from the pipeline to pre-2014 levels of between 250,000 bpd and 400,000 bpd”. The government has now taken control over three of the wells. The Kirkuk‐Ceyhan pipeline to Turkey has been out of action for several years. The federally‐controlled pipeline was destroyed by militants in 2014, prior to ISIS capturing territory that the pipeline ran through. The oil has been flowing from the KRG from a different pipeline constructed for the KRG. The Iraqis hope that restoring their original pipeline will divert the flow from the KRG to Ceyhan to the Kirkuk-Ceyhan Pipeline. This Pipeline will reportedly need a great deal of repair after a series of attacks and over two years of disuse. One oil analyst, quoted in the FT, expressed scepticism as to how fast the repairs could be completed. In addition, even when it is repaired, sections of the pipeline will still pass through territory controlled by Kurdistan in order to reach Turkey’s border, which could cause further tensions between Baghdad and Erbil.

The Turks have threatened to block all KRG oil from the Ceyhan pipeline and have positioned troops and armour on the border. Iran has moved tanks and artillery up to the border with Iraqi Kurdistan, close enough to the boundary that they are visible from the other side. On Oct. 2, 2017, the Iranian forces appeared along the Iran-Iraq border, reportedly as part of a previously announced combined drill with Iraqi national forces and militia in retaliation for the independence vote. The Iraqis have blocked the airspace and on Sunday they invaded, with the Irani forces.

The resolution over who controls the oil exports from the wells to Ceyhan is not a question of merely supplanting North Oil from the Kurds. The main customer for the oil is Russia. Russia has an important stake in this business and has been careful to cultivate a good relationship with the Kurds. An important aspect of the attempted blockade of KRG oil to Ceyhan by the Turks has been the Turks inability to block the Russians. There was a signing of a series of deals with Russia’s Rosneft with the Kurds on the exploration, production, and delivery of hydrocarbons, as well as Russian investments in the region. On Jun2, 2017 Russia agreed to buy Kurdish oil and refine it in Germany. As a first step, Russia agreed to invest $3 billion in KRG territory.  This was badly needed as in 2014, the central government had decided to reduce the Kurdish share in the budget, which the KRG declared was unconstitutional. According to the KRG, the Iraqi government also violated the constitution by failing to hold a referendum in the disputed territories. Hence, the KPD included them in the referendum.

However, the Russians have said they are ‘neutral’ in the dispute and fully intend to take oil from the KRG. Russia has informed Turkey that if the Turks try to block their oil export routes then the Russian’s will cut off crucial oil and gas supplies to Turkey.

The Iranians are also tempering their response to the Kurds in that they are awaiting the possibility of U.S. sanctions against Iran being re-imposed which would include a blocking of Iran’s exports. That would make an alternative export route attractive, even through Kurdistan.

So, there is very little likelihood of actual, as opposed to rhetorical, warfare breaking out, especially as the U.S. (which arms and advises both sides), that the war with Daesh is not yet over. There is also no evidence of action by Barzani towards proceeding apace with a declaration of independence. The upcoming Kurdistan elections in November appear to indicate a weakening of KDP power and influence; not only as a result of the strengthening of the other Kurdish parties, but mostly because of the resistance of the non-Kurds to inclusion in an independent Kurdistan.

The Turks, while ostensibly supporting the Turkmen, have serious challenges. Erdogan is in a very difficult position; one which he has brought upon himself. He was adamantly opposed to Barzani calling the referendum. He has threatened all manner of dire consequences against the shipping of oil through Ceyhan but was brought up abruptly by the Russians when, on October 5, 2017 Putin declared at an energy forum in Moscow, that “Russia was following a policy of “non-interference” in Iraqi Kurdistan and that it is not in anyone’s interest to halt the Kurdistan Region’s oil exports.” Erdogan began to change his tune.

In its June agreement, Rosneft got the right to pick five new oil and gas production blocks and to expand the capacity of the oil pipeline running from the Kurdistan Region to loading terminals in the Turkish port city of Ceyhan from 700,000 barrels per day (bpd) to 1 million. Iraqi Kurdish crude purchased by Rosneft is being delivered from there to its refineries in Germany. The company is believed to have already injected at least a billion dollars to the KRG. The infusion has allowed the KRG, among other things, to settle a long running legal dispute with Pearl Petroleum, which is operating Iraqi Kurdistan's richest gas fields in Chamchamal and Khor Mor.

On Sept. 18, 2017 Rosneft and the KRG inked another memorandum of understanding whereby Rosneft would build, own and operate a natural gas pipeline to carry the region's vast reserves of high quality natural gas to Turkey. According to Amy Myers Jaffe of the Council on Foreign Relations, “The mooted deal is said to include a possible stake in the Kirkuk oil field,” including “areas previously operated by the Iraqi states’ North Oil Company.”

There are unconfirmed reports that Turkey is withholding the proceeds of the sales, which are deposited in the state-owned HalkBank and then transferred to Iraqi Kurdish banks. To get around it, the Iraqi Kurds are rumoured to be getting some of the cash — particularly from Israel, which is believed to buy some Iraqi Kurdish oil — through alternative channels. But now that Iraq has closed Iraqi Kurdistan's air space to international flights, it's improbable that any such arrangement could continue. Israel is one of the most enthusiastic proponents of Iraqi Kurdish independence, making Turkey and Iran all the warier.

Shutting down the pipeline would hurt Turkey in various ways. For one, it would be unable to recover over a billion dollars in transit fees owed by the Iraqi Kurds. Maintaining the pipeline also costs money. The petro dollars used to pay government employees allow them to buy the Turkish products flooding the market. It would also dent Turkey’s image among energy traders. The volume of trade between Turkey and the KRG is currently estimated at least $2.5 billion. Turkish businessmen are said to be owed some $1.8 billion by the KRG. Closing the pipeline would be very expensive for Turkey.

As a result of the joint opposition to Kurdish independence the Turks have established close military and intelligence ties to Iran. Tehran is in a little different position. In the last two months Turkey and Iran have formed a close political and military alliance, despite Erdogan’s frequent attacks on the Shia.  The Sept. 25 independence referendum held by the Kurdistan Regional Government (KRG) in Iraq has resulted in the Ankara-Tehran relationship quickly assuming features of an informal military-security cooperation. Three meetings provide insight into the rapprochement and its future direction: the Aug. 14-15 visit of Iranian Chief of Staff Gen. Mohammad Bagheri to Ankara; the Oct. 1-4 visit to Tehran by Turkish Chief of the General Staff Gen. Hulusi Akar; and the Oct. 4 visit to Tehran by Erdogan.

After Bagheri’s visit, the two countries decided to augment cooperation in securing borders, coordinating intelligence and conducting counterterrorism operations. The primary objective is to physically sever connections between the Kurdistan Workers Party (PKK), which Turkey considers a terrorist group, and its Iranian affiliate, the Party for a Free Life in Kurdistan (PJAK), and then marginalize them.  Security sources have said that the two countries have signed a protocol to carry out joint border security exercises at the platoon and company levels and to conduct joint border patrols targeting cross-border smuggling, from which the PKK and PJAK have been profiting. Iran has reacted favourably to Turkey’s construction of a 90-mile security wall along their 310-mile common border. Military sources said they have discussed how Iran might contribute to border security, perhaps through a joint drone surveillance system or constructing surveillance towers along critical routes on Iran's side of the border.

Of more importance, the countries signed a protocol for intelligence sharing between the Turkish Gendarmerie Command and border security units of the Islamic Revolutionary Guard Corps (IRGC) at the tactical level. Iran and Turkey also agreed to friendly visits of their naval vessels to each other’s ports and signed three separate protocols for exchanging war academy cadets and military medical students to cooperate on education. Both countries seem eager to formalize intelligence sharing on border security and surveillance of Kurdish movements by mobilizing permanent outposts with drones and aircrafts and perhaps, in the coming months, by establishing “fusion centres” for intelligence sharing in Tehran and Ankara. It is also possible that institutionalizing military-to-military bilateral relations will result in a trust being built that accelerates diplomatic normalization.

On the other hand, the Iranians are watchful about developments with the U.S. This has less to do with the nuclear deal. The fear is that the Congress will name the Pasdaran and its Quds force as terrorist organisations and impose sanctions again against Iran. That would certainly lead to an outbreak of violence against U.S. forces in Iraq and Syria in which the Turks and the Iraqis might, however unwillingly, be a part. That is the real danger to the region. The event which precipitated the U.S. move to declare the IRGC a terrorist group was the explosion of a lethal bomb of a type generally associated with Iran and its proxies. This type of bomb, an explosively formed penetrator (EFP) has re-emerged in Iraq after a six-year hiatus, killing an American soldier. On Oct. 1, an EFP struck a US vehicle north of Tikrit in Salah ad-Din province. The convoy was traveling south along Highway 1, known in American military parlance as Main Supply Route Tampa. The attack killed Spec. Alexander W. Missildine and wounded another soldier. The bombing occurred near Camp Speicher, the site of the Islamic State’s massacre of Iraqi Shiite air force recruits in 2014. A steel EFP struck a US vehicle at a dip in the road along Route Tampa. An explosively formed penetrator (EFP) was the signature of the Mahdi Army and Special Groups, Iranian militias that targeted US and allied forces in Iraq. Composed of a milled concave plate typically formed of copper, EFPs are extremely lethal, even against thick armour. They are manufactured in Iran. The use by the Iranians of an EFP to kill an American soldier was seen as a declaration of intent to block the U.S. forces from assisting the Kurds in Iraq and in Syria. Hence, the U.S. has asked the Treasury to name the IRGC as a terror group and develop appropriate sanctions against them.

The naming of the IRCC as a terrorist group will have serious consequences for Turkey. While the Turks might want to create an alliance of sort with Iran (primarily for their support in Syria against the YPG and the Syrian Kurds) it will have to acknowledge its policy of working with such a terrorist organisation. The Turks can’t use the fact that the PKK is recognised as a terrorist organisation and demand that all countries sever their contacts with the PKK if the Turkish army and the MIT are allied to the Iranian IRGC. It’s position in NATO, already dodgy, will quickly get a lot worse.

The Repercussions of the Referendum and the Invasion of Kirkuk

While the Kurds have been compelled to subordinate some of the political differences which divide them in the face of the invasion on Sunday, there are still differences among the Kurdish parties. The Kurdish President of Iraq Fuad Masum travelled to Suleimaniya on October 14 to mediate a possible resolution of the standoff in Kirkuk. He later met with leadership from both the PUK and the KDP in Dokan, Suleimaniya province and then delivered a five-point proposal to Baghdad. Baghdad rejected the proposal. The U.S. is keen to keep the pressure on Daesh as the focus of their activity and continues its preparation for operations outside the need to deal with Turkey or Iran. It should be noted that a new American military base is being constructed 50 kilometres (31 miles) northwest of Mosul, in an area controlled by the Kurdistan Regional Government (KRG) peshmerga forces. The base is also 50 kilometres from the Syrian border, which is controlled by the People’s Protection Units (YPG), a strong US ally currently fighting IS in Raqqa and Deir ez-Zor in eastern Syria. The United States is additionally building a sprawling consulate in Erbil that will cost some $600 million. Meanwhile, Washington appears to have taken charge of the Harir base, also known as Bashur Airfield, 65 kilometres (40 miles) west of the Haji Omran border crossing with Iran. The US government used the base for the first time in March 2003 as part of its invasion of Iraq.[iv]

Iraq’s next local and national elections, which are due to be held in April 2018, could bring about a sea change in the country’s electoral landscape. The results could shock the political system, as voters turn towards candidates who took part in the campaign against Daesh. Abadi will reap some of the rewards from this mood, but so will leaders of the Popular Mobilization Forces, a paramilitary grouping of mostly Shiite volunteers who are largely credited with halting the onslaught of the Islamic State toward Baghdad and the southern provinces in 2014. The rewards for the Kurds whose Peshmerga forces played such an important role will be less. It seems unlikely that violence and conflict will increase or spread in Iraq but the notion of the Kurds actually declaring their independence after the November elections is unlikely. Each still need each other in delivering Kurdish and Iraqi oil to the market for the foreseeable future. At some point the U.S. will have to choose between the honouring its commitments to the Kurds or to continue its feeble engagement with a kaleidoscope of Middle Eastern forces which do not wish America well or success. In all this, the beneficiaries are Russia who are becoming a major force in the region following the vacuum of American policy.