Abdul-Mahdi: Now the Real Work Begins

If there is a loser in the Baghdad-Erbil oil deal, there is no doubt it is Ankara, although some nuance is required. It is not a defeat, since Ankara never declared its opposition to a deal between Baghdad and Erbil. Ankara only lost its exclusive relationship with the Iraqi Kurds. Turkey, however, can absorb this loss in exclusivity as long as it also involves placing Kurdish aspirations for independent statehood, a fearful development for Ankara, on the back burner.

Interestingly, the Baghdad-Erbil deal coincided with the demise of the long-vaunted and ambitious South Stream project of Russian President Vladimir Putin to carry Russian natural gas to Central Europe under the Black Sea.

Before the ink on the Iraqi oil deal had dried, Putin — at a Dec. 1 press conference in Ankara with President Recep Tayyip Erdogan — declared the scrapping of the $50 billion project for Gazprom to transport Russian gas to Bulgaria, Serbia and Hungary. He pledged, however, to construct a sub-Black Sea pipeline to Turkey as an alternative and promised a cut in natural gas prices along with a one-third increase in gas exports for Turkey.

Turkish pro-government circles were delighted with this news at a time when Turkey is increasingly isolated in the international arena. Erdogan was seen beaming next to his Russian counterpart when Putin made his generous pledges. In Brussels, however, I was told that the European Union views the cancelation of South Stream as a defeat for Putin. The consensus was that the project — which Brussels opposed from the start for violating EU rules of competition — had fallen victim to the recent tensions between Brussels and Russia. Putin in effect bowed before the EU sanctions and the financial constraints imposed against Moscow.