The Politics Behind Iraq’s Kurdish Oil

However much solidarity the US wants to show with the Kurds (and surely they deserve the real deal, not Kissinger’s false embrace) encouraging oil investment before there is a national consensus on sharing revenues is risky – maybe even reckless.

It could make sense if you’ve have concluded that Iraq will eventually break up into three separate entities (Sunni, Shiite, and Kurdish), as diplomat Peter Galbraith has argued we should accept sooner than later and work to facilitate.
But that’s not US policy. The danger is that pressing ahead with oil production now could help trigger Iraq’s implosion, which may not be necessary. Breaking up would surely be risky and bloody – perhaps mostly because of Turkey.

How this plays out depends on how adroitly Kurds play this. From their point of view they have every reason to press ahead developing their oil resources –- whether or not the end-game plan is full independence.

With some 22 reported petroleum contracts already, some observers suggest the Kurds want to create a fait accompli that the central government will not be able to overturn.

CNBC