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NextImg:State Department does Iraq a disservice with energy schemes

When Biden administration officials like Brett McGurk, White House coordinator for the Middle East, and Amos Hochstein, special presidential coordinator for Global Infrastructure and Energy Security, pass through Iraqi Kurdistan, top on their agenda is encouraging Iraqi Kurds to sell oil to Turkey . The two senior officials, neither of whom has Senate confirmation, couch their entreaties in U.S. efforts to isolate Russia and Iran .

Kurds would be foolish to assume that the two have the full backing of the State Department , let alone the broader U.S. government. For too long, American officials have played in the Iraqi and Iraqi Kurdish oil markets to their own benefit.

Peter Galbraith, a Democratic activist, former diplomat, and National Defense University professor, leveraged his Kurdish contacts into oil contracts shortly after Operation Iraqi Freedom. Zalmay Khalilzad, a stalwart of Republican administrations, followed suit. Trump administration National Security Council Director Matthew Zais moved from the White House to become vice president of government affairs for HKN Energy, an outfit with extensive interests in Iraqi Kurdistan, although these may soon be ending.

It is impossible to know Hochstein’s motives, but between the Obama and Biden administrations, he worked both for a Houston liquefied natural gas export company and on the board of a Ukrainian oil and gas firm. Unlike many inside the administration, he is no stranger to the private sector.

While it may be tempting for foreign officials to believe the word of senior American officials, it is important to differentiate between those confirmed and those unable to meet that standard. Kurdish oil is a tricky business. There are four problems with any policy purporting to encourage Kurdish oil sales through Turkey to Israel or other buyers.

First, the Iraqi Supreme Court last year found against the Kurdistan Regional Government’s oil and gas law. That was the basis for various Production Sharing Contracts with international oil firms. To encourage deliberate defiance of the Iraqi Supreme Court and government of Iraq has both legal and diplomatic ramifications. It is for this reason that the State Department’s top Iraq officers are increasingly frustrated with Hochstein, who uses his energy mandate to run roughshod over sensitive policy.

Second, the International Court of Arbitration in Paris is prepared to side with Iraq against Turkey and Ankara’s dealing in Kurdish oil. The judgment against Turkey for buying Kurdish oil might amount to more than $10 billion. The Iraqi and Turkish governments are engaged in last-minute diplomatic brinkmanship to reach a settlement that would put aside the decision. To encourage Kurdish defiance of Baghdad and dealing with Turkey threatens broader diplomacy.

Third, the logic that trans-Turkey pipelines sideline Russia and Iran is nonsense. Azerbaijan, which ships oil across Turkey for export, openly participates in gas swaps with the Islamic Republic of Iran to make up for shortfalls. Turkey, meanwhile, has become money laundering central for the Kremlin.

Finally, even if Hochstein had the State Department’s buy-in for his scheme (and it is unclear he does), Congress does not approve of such empowerment of Turkey. Indeed, while Hochstein has sought to kill the EastMed pipeline in favor of TurkStream, many in Congress prefer to focus on future investment in Israeli, Cypriot, and Greek gas. Prominent congressmen and senators, including committee chairmen and ranking members, find any dealings which enrich and empower Turkish President Recep Tayyip Erdogan to be counter to U.S. regional interests.

It is bad when administrations do not speak with one voice. It is worse when freelancing undermines U.S. interests. The Biden administration needs to get its team under control. Iraqi Kurds, meanwhile, should be very careful as they move forward. Taking the advice of freelancing officials could lead them to a far broader fight with Congress and, down the road, perhaps even sanctions.

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Michael Rubin ( @mrubin1971 ) is a contributor to the Washington Examiner's Beltway Confidential. He is a senior fellow at the American Enterprise Institute.