Iraqi Cabinet Approves Updated Oil Law – Or Not

So Iraq’s controversial oil law draws ever closer. Earlier today, AP and Reuters reported that Iraq’s cabinet approved changes to the law and will now submit the bill to parliament.

However, a UPI story just out from Ben Lando (who has followed the law more closely than any other journalist) quotes Kurdistan Regional Government Natural Resources Minister Ashti Hawrami as saying “We are not aware of anything being passed by the Cabinet”.
Reuters had a different story. “The cabinet has endorsed the oil law and is sending it to parliament,” spokesman Ali al-Dabbagh said. The draft, crucial to regulating how wealth from Iraq’s huge reserves will be shared by its sectarian and ethnic groups, was originally approved by the cabinet in February but faced stiff opposition from Kurds, who felt they were getting a bad deal.

It is interesting to see how this is being spun in the international press. According to Reuters: “Washington has been pressing Iraq’s leaders to speed up passage of the oil law and other measures it views as crucial to spurring national reconciliation and ending sectarian violence between majority Shi’ites and minority Sunni Arabs”.

More to the point is that Washington wants the Oil law signed as it gives unprecedented control and access to the multinational oil firms.

Our guess here is that there is confusion between the revenue sharing law and the foreign investment / oil law. This confusion has been deliberately sown by the Bush administration and the Iraqi government, who have consistently sought to portray the foreign investment/oil law as a revenue sharing law – when in fact revenue sharing is a separate piece of legislation.