Turkey claims Iraqi oil

Turkish soldiers on parade

The Turkish daily Sabah reported that Turkey is demanding 10 percent of Iraqi oil annually after the war, bringing in $5.5 billion dollars a year if Washington agrees.

This is not a new claim. Turkey is relying on the 1923 Lausanne treaty, which officially marked the boundaries of the Republic of Turkey with all parties except Britain. The agreement between the two powers was to be a "friendly arrangement to be concluded between Turkey and Great Britain within nine months." Unfortunately, the two parties could not come to an agreement, with Turkey continuing to lay claim to the province of Mosul in present-day Iraq, and the matter was referred to the League of Nations.

Turkey's reluctance to part with Mosul was based on several factors: Mosul wanted to remain in the Turkish fold, it had many Turkish-speaking citizens, its trade routes and of course, its oil reserves. Also, on Oct. 30, 1918, when the armistice ending World War I was signed, British troops were still several miles outside the city, making the British claim on the area less than convincing.

But in 1926, Turkey finally accepted the "Brussels line," giving Iraq (a British protectorate) the oil-rich province of Mosul, along with its 600,000 or so inhabitants. In compensation, Turkey was to receive a portion of the oil revenues -- including those from transportation and other petroleum products -- out of Mosul for 25 years, but instead Turkey agreed to a £500,000 buyout.

This conflict has flared up over the years, with the most recent being in 1995 when during Operation Steel, Turkey moved approximately 35,000 troops into northern Iraq to hunt PKK members. As the troops were leaving, Turkish president Süleyman Demirel said to the press:

The border is wrong. The Mosul Province was within the Ottoman Empire's territory. Had that place been a part of Turkey, none of the problems we are confronted with at the present time would have existed.

Iraq, of course, fiercely resisted the idea of redrawing borders (even though Saddam's regime had lost control of the northern provinces) and even the Iraqi opposition found common ground with the dictator in denouncing Demirel's comments. In the face of such opposition from everyone in the region, including Syria, Iran and even Egypt, Demirel backed down, saying that the issue of borders had indeed been settled in 1926. "Turkey has no policy about any new border arrangements and has no plans to reconsider such matters," he told an Arabic newspaper.

(Thanks to Daniel Pipes for the background on this.)

So this is just more of the same from the Turks. They have never forgotten the loss of Mosul and Kirkuk, and I've written about this several times here and here (at the bottom.) What's new is the dropping of the demand of the return of the territories, but settling for a portion of oil revenues.

This says to me that Russia's and France's oil contracts in Iraq have a shelf-life of about two months now. After the war, The Shells, Exxon-Mobiles and other American oil companies will take over the Iraqi oil industry and begin ladeling out spoils to friends, a category which almost certainly doesn't include Russia or France. Turkey, however, although it has been lukewarm to a war in public, has nonetheless come onboard.

The claim of 10 percent of the oil submitted to Washington is either ballsy in the extreme, or the Turks believe they have done something right to expect that kind of revenue. Most likely, they have given up territorial claims and backed down on their sabre-rattling against the Kurds, who will also be mollified by this, since it will keep Turkish troops out of their territory and they will still get some oil revenue from Kirkuk and Mosul. (Also remember the Turkish economy -- especially in the southeast around Diyarbakir -- has been pistol-whipped by the U.N. sanctions. That $5.5 billion extra a year would sure help out in a $42.5 billion annual budget.) The United States wins because it keeps the situation in the north stable, without having to play referee between Turkish forces and PUK and KDP peshmergas.

This all sounds great, except that Turkey is relying on a 76-year-old agreement to lay claim to oil that doesn't belong to it. Whether the United States will point out this elephant in the living room remains to be seen.