Iraqi Kurdistan makes first oil sale amid exports row Published duration 23 May 2014

image copyright AP image caption Oil revenues make up nearly 95% of Iraq's budget

The government in the Iraqi autonomous region of Kurdistan says it has made its first sale of crude oil despite strong opposition from Baghdad.

The oil was piped to the Turkish port of Ceyhan, the Kurdish authorities said in a statement

Iraq's central government says it has filed legal action against Turkey and the pipeline operator.

It is locked in a bitter dispute with the Kurdistan Regional Government (KRG) over who can sell the country's oil.

Analysts say the latest development could further strain relations between Baghdad and the KRG, as well as ties between Iraq and Turkey.

'First of many'

The Kurdish government says it hoped to reach an understanding with Baghdad but would continue to export oil independently until then.

In a statement, it said more than a million barrels of oil were loaded in Ceyhan on Thursday night and shipped to Europe.

"This is the first of many such sales of oil exported through the newly constructed pipeline in the Kurdistan region," it said, adding that the revenue would be treated as part of the region's share of the national budget.

Iraq's oil ministry filed a request on Friday for arbitration with the International Chamber of Commerce in Paris against the Turkish government and its state-run BOTAS company, according to a government statement.

It said that by "transporting and storing crude oil from Kurdistan... without the authorisation of the Iraqi ministry of oil" Turkey had violated the terms of an agreement between the two countries.

The tensions come as Iraqi Prime Minister Nouri Maliki looks to form a new coalition government after falling short of a majority in last month's parliamentary elections.

Analysts say the Kurds could use the negotiations to secure concessions.

Oil underpins Iraq's economy, making up more than 95% of its budget revenues.

Until now, all exports have gone through a pipeline controlled by the federal government, with Baghdad collecting the revenues for distribution.

The dispute between Iraq and the KRG has caused a series of stoppages in oil exports.