Iraqi Gov't, Kurds Reach Agreement on Oil, Arms

The Iraqi government and the country's Kurds have reached an important agreement on oil revenues and plans to fight the Islamic State, boosting hopes that the group can eventually be defeated.

The New York Times reports that a major part of the deal is a promise that Baghdad will pay the salaries of Kurdish fighters known as the pesh merga. The deal also allows for the provision of U.S. military aid to Kurdish forces with the Iraqi government acting as a middle-man.

The agreement also helps to keep Iraq's disintegrating borders together. The previous refusal of the government to make payments to the Kurdish region as IS seized control of large swathes of Iraqi territory fuelled Kurdish calls for their own independent state. The fact that parts of the Kurdish controlled areas were cut off from the government in Baghdad also made this a de facto reality on the ground.

For example, the city of Kirkuk was under government control, but when IS launched its offensive, Iraqi soldiers abandoned their positions. The Kurds filled the void, taking control of the city and oil fields that can produce around 300,000 barrels of oil daily, according to the Times.

One portion of the deal will see oil collected from Kirkuk sent to the international market with the revenues split evenly between the government in Baghdad and the Kurdish capital in Erbil. An additional 250,000 barrels collected in Kurdish territory will also be sold by the Iraqi government.

The agreement will help the Kurds find a market for their oil, which they had previously tried to sell independently of the Iraqi central government. The Kurds struggled to find buyers for the oil because the United States and Iraqi government viewed the selling of oil through non-governmental channels as illegal, and individuals who purchased the oil could find themselves the subject of legal action.