Economy
Energy partnership between Türkiye, Iraq gets new, ‘historic’ dimension
Ankara and Baghdad are adding a new dimension to their energy partnership, moving beyond pipeline transit and toward upstream production after Türkiye’s state-run company took a stake in a major consortium developing oil fields in Iraq’s Kirkuk region.
The agreement, announced on Tuesday, will see the Turkish Petroleum Corporation (TPAO) acquiring a 15% share in BP Energy Company of Kirkuk Limited (BPECKL), a consortium including BP and ConocoPhillips, to develop several of Iraq’s largest oil fields.
The deal was signed ahead of a meeting between President Recep Tayyip Erdoğan and Iraqi Prime Minister Ali al-Zaidi, who was in Ankara for talks on security, trade, energy, transportation and water management, as well as joint infrastructure projects between the two neighbors.
The consortium will work to increase production at the Baba and Avanah domes, as well as the Bai Hassan, Jambur and Khabbaz fields in Kirkuk.
The fields currently produce around 300,000 barrels of oil per day (bpd), according to the latest publicly available field-level production data from Iraq’s Extractive Industries Transparency Initiative (EITI). Bai Hassan accounts for approximately 133,000 bpd, followed by the Baba and Avanah domes with around 107,000 bpd, while Jambur and Khabbaz produce roughly 38,000 bpd and 25,000 bpd, respectively.
Erdoğan called the agreement “historic,” while Energy and Natural Resources Minister Alparslan Bayraktar said TPAO will work together with BPECKL partners to bring the approximately 3 billion barrel reserve potential into production.
BP confirmed the deal and said it welcomed the partnership with TPAO.
The British energy major estimates the contract area could ultimately hold resource potential of up to 20 billion barrels.
Partnership expands beyond pipeline transit
The agreement comes as Ankara and Baghdad seek to broaden their energy relationship beyond crude oil transportation that has mainly involved the Iraq-Türkiye pipeline, whose 1973 bilateral agreement expired on Monday.
The neighbors are soon expected to sign a deal to keep the Kirkuk-Ceyhan crude oil pipeline open for another year.
On Tuesday, Erdoğan said Türkiye aimed to sign a comprehensive energy cooperation deal with Iraq as soon as possible.
He also said Türkiye could get up to 1 million barrels of oil a day under a cooperation plan discussed on Tuesday with al-Zaidi.
Al-Zaidi, who emerged as a consensus candidate in Iraq after months of deadlock over the premiership following last year’s parliamentary elections, was visiting Ankara in the wake of trips to Washington and Tehran.
Following his talks with U.S. President Donald Trump earlier this month, U.S. companies signed agreements and partnerships worth around $60 billion with Iraq, including deals intended to create alternative routes for shipping oil out of the Persian Gulf.
Minister Bayraktar has said Türkiye and Iraq are negotiating a new framework that would cover not only crude oil but also natural gas and wider energy infrastructure cooperation.
As part of the transition, Türkiye has proposed allowing state pipeline operator BOTAŞ to continue transporting Iraqi crude for one year while negotiations on a new long-term agreement continue.
Bayraktar said Iraq requires transportation capacity of around 750,000 bpd. Although current flows stand at roughly 180,000-200,000 bpd, Türkiye says it is prepared to make the full capacity available once exports resume.
One project under consideration is a pipeline that would connect southern Iraq’s Basra to western Iraq’s Haditha and from there to the Ceyhan port in Türkiye and the port of Baniyas on Syria’s coast.
The Kirkuk partnership, meanwhile, is seen as a key step toward Ankara’s goal of making TPAO capable of producing the equivalent of 1 million barrels of oil and natural gas per day.
Analysts see strategic significance
Kate Dourian, a non-resident fellow at the Arab Gulf States Institute in Washington, said TPAO’s participation is closely linked to ongoing negotiations over the future of the Iraq-Türkiye pipeline.
Following the expiration of the previous agreement, both sides are working toward a new framework that is expected to include oil, natural gas and electricity flows, Dourian told Anadolu Agency (AA).
The interim arrangement would allow Iraqi crude exports through Türkiye’s Mediterranean port of Ceyhan to continue while negotiations proceed.
“Under the one-year agreement, Baghdad has committed to increasing flows from 220,000 bpd currently to around 750,000 bpd. Meeting this ambitious target will require further development of the Kirkuk oil field and it makes sense for TPAO to be involved,” Dourian said.
She also noted that partnering with BP and ConocoPhillips could position TPAO for future upstream projects in Iraq and potentially in other countries where the two companies operate.
Mehmet Öğütçü, chair of the London Energy Club, said the partnership represents a milestone in Türkiye’s strategy of becoming not only an energy importer but also a producer and developer of energy resources.
He said energy security is strengthened not simply by purchasing oil but by participating directly in production, adding that Iraq’s estimated 145 billion barrels of proven reserves make it one of the world’s largest holders of oil resources.
According to Öğütçü, TPAO’s presence alongside BP and ConocoPhillips in one of the world’s most productive oil basins will strengthen Türkiye’s position in international energy markets, expand the company’s overseas production portfolio, increase foreign currency revenues and contribute to the country’s long-term energy security.
He added that restoring the strategic role of the Kirkuk-Ceyhan pipeline would also support Türkiye’s ambition to become a regional energy trading hub.
“This agreement should not be viewed merely as a 15% equity stake,” Öğütçü said. “Its real value lies in TPAO joining global energy companies in one of the world’s most important oil provinces,” said Öğütçü.
“The project’s strategic value extends well beyond the size of TPAO’s stake. With an initial resource potential of more than 3 billion barrels of oil equivalent (boe), it represents a long-term strategic gain for Türkiye’s energy security, international production capacity and ambition to become a regional energy hub.”
The U.S. Federal Reserve left interest rates unchanged on Wednesday, keeping borrowing costs steady while putting renewed focus on Chair Kevin Warsh’s pledge to bring inflation back to the central bank’s 2% target.
The widely expected decision to leave the benchmark interest rate in the 3.50%-3.75% range drew dissents from three of the 12 members of the policy-setting Federal Open Market Committee who “preferred” a quarter-percentage-point hike at this meeting. Those same three, the presidents of the Fed’s Cleveland, Dallas and Minneapolis regional banks, had also dissented at Jerome Powell’s final meeting as central bank chief in late April, that time in favor of removing the implied promise of lower rates.
Warsh, who took over as head of the Fed in May, has said he has “no tolerance” for inflation that has been running above the central bank’s target for more than five years, and up until last month was accelerating as the war in the Middle East pushed up global fuel and food prices, and investment in data centers and other spending tied to artificial intelligence drove up demand.
“Inflation remains elevated relative to the Committee’s 2% goal,” the Fed said in a short policy statement after the end of its latest two-day meeting. It replicated word for word all of the June 17 statement’s assessment of the economy.
The Fed said economic activity is “expanding at a solid pace,” noting, as it did in June, that job gains “have kept pace with the workforce, and the unemployment rate has changed little.”
In leaving the policy rate pinned in the range it has been since December, Fed policymakers are embracing the idea that current borrowing costs are creating enough friction in the economy to reduce any inflation that isn’t, like the effect of tariffs on goods prices, expected to fade on its own.
Warsh has said little about the mix of risks and nothing about the outlook for the policy rate, though he has expressed the expectation that rising productivity aided by AI will allow the economy to grow faster without also pushing up inflation.
Financial markets ahead of this week’s meeting had priced in about a one-in-three chance of a rate hike and, absent such a move at this week’s meeting, nearly a 100% chance of an increase in September. By then, Fed policymakers will have in hand two more monthly readings on inflation and the jobs market, giving them a better picture of whether the cooling price pressures evident last month have continued.
Türkiye and Tunisia stressed Wednesday their intention to elevate their bilateral trade volume through new collaborative agreements.
Türkiye’s Deputy Trade Minister Mahmut Gürcan noted that countries now seek strategic production and investment partners alongside traditional trade relationships.
Gürcan was speaking at the Türkiye-Tunisia Business and Investment Development Forum in Istanbul, attended by senior officials and sector representatives from the two countries.
Türkiye’s exports to Tunisia reached $1.2 billion (TL 56.88 billion) in 2025, marking an 11.6% increase, while imports from the country stood at $350 million.
Gürcan emphasized that the goal is not only to export but also to purchase Tunisian products to foster a mutually beneficial economic relationship.
Banu Küçükel, chair of the Foreign Economic Relations Board (DEIK) Türkiye-Tunisia Business Council, highlighted that Tunisia serves as a strategic gateway to Africa.
Küçükel stated that the two countries have strong complementary advantages in sectors such as automotive, machinery, electronics, textiles and agriculture.
Participants held bilateral meetings during the forum to explore new trade and investment opportunities.
Türkiye’s fast-growing shipbuilding industry is seeking to get a larger role in Nigeria’s maritime modernization push, as the two countries are said to move toward joint production, technology transfer and long-term industrial cooperation.
Nigerian authorities are looking to position Turkish shipyards not only as suppliers of vessels but also as strategic partners capable of helping develop the country’s domestic shipbuilding capacity, Anadolu Agency (AA) said on Wednesday, citing information compiled from industry and government sources.
The initiative was discussed during a government and industry dialogue organized with technology provider DAMISE and the Nigeria-Türkiye Business Council, where participants focused on joint manufacturing, technology transfer, fleet modernization, inland waterway transportation, workforce development and financing models.
The council aims to translate government-level engagement into concrete investment partnerships and production projects between Turkish and Nigerian companies.
In a statement, Nigeria’s Marine and Blue Economy Ministry highlighted the country’s approximately 853-kilometer (530-mile) coastline and more than 10,000 kilometers of inland waterways, inviting Turkish shipbuilders to view Nigeria not only as an export market but also as a potential manufacturing hub for the African Continental Free Trade Area (AfCFTA).
From exports to industrial partnership
Türkiye’s shipbuilding industry has expanded rapidly in recent years.
According to Trade Ministry data, the country’s ship exports rose from around $900 million in 2018 to $3 billion in 2025, lifting Türkiye’s global ranking in ship exports from 28th to 10th.
During the same period, Nigeria’s ship imports declined from $3.4 billion to around $500 million, reflecting a shift away from an import-dependent model toward developing domestic production capabilities and technical expertise.
Commercial ties between the two countries have gained momentum following Nigerian President Bola Ahmed Tinubu’s visit to Türkiye earlier this year, with both sides stepping up efforts to expand bilateral trade and industrial cooperation.
The emerging partnership is expected to extend beyond shipbuilding to include technology transfer, specialized vessels, ferries, ship maintenance and repair, and broader maritime infrastructure projects.
Nigeria’s National Inland Waterways Authority has also invited Turkish shipyards and maritime technology companies to participate in developing vessels, ferry terminals and public-private partnership projects across the country’s roughly 3,000 kilometers of navigable inland waterways.
Türkiye’s maritime sector includes around 85 active shipyards, a Turkish-owned fleet of more than 2,270 vessels and an extensive maritime education network, providing opportunities for cooperation in engineering, training, maintenance and technology transfer.
Gateway to West African markets
Industry officials see production and maintenance facilities established in Nigeria serving not only domestic demand but also neighboring West African markets.
Nigeria’s Cabotage Act, which provides incentives for vessels built, owned and operated locally, is viewed as an additional factor encouraging Turkish companies to establish local partnerships rather than rely solely on exports.
Analysts say a strategy centered on joint production, maintenance and operational partnerships with Nigerian firms could provide Turkish shipbuilders with a more sustainable long-term presence in the market.
Fishing vessels, offshore support ships, fleet renewal, ship repair and inland waterway transport are expected to offer the strongest near-term opportunities for cooperation.
Over the longer term, discussions are expected to expand to include green shipping, maritime decarbonization, technical workforce development and joint financing mechanisms.
The next round of talks, focusing on matching Turkish shipyard capabilities with Nigeria’s fleet modernization needs, is scheduled for the coming days, while a separate session on financing and workforce capacity is planned for Aug. 5.
The framework for a 2027 Maritime Cooperation Road Map is expected to be unveiled following the discussions.
Thousands of Audi workers protested Wednesday against the possible closure of the German automaker’s Neckarsulm plant, as parent company Volkswagen moves forward with a restructuring expected to involve tens of thousands of job cuts.
The protest came as rival premium carmaker BMW announced thousands of job cuts, the latest blow to employment in Germany’s auto industry, where high costs, growing Chinese competition and U.S. tariffs are forcing painful restructuring.
“We are scared of factories closing and endangering our future,” Audi worker Melih Cevlik said at the protest in Neckarsulm.
About 6,000 people took part, according to the works council.
Workers demanded clarity from Volkswagen, whose CEO Oliver Blume has warned Neckarsulm is among four German plants that could close after 2030 if no alternative solution is found.
“The staff wants clarity because they’re worried about coming to work. Many families are worried, too,” Audi trainee Frank Wojko said against the din of rattles waved by protesters.
Blume has sought to avoid plant closures and floated alternatives including defence partnerships and production of Volkswagen’s Chinese models, which are not currently sold in Europe, at underutilized factories in Germany.
But no decisions have been taken and the second half of the year is expected to be dominated by tense negotiations with Volkswagen’s powerful labor representatives, including over a proposed doubling of job cuts to 100,000 across the group.
About 15,000 people work at the Neckarsulm site, which produces Audi’s A5, A6 and A8 models and is also home to low-volume production of the all-electric Audi e-tron GT.
Alexander Reinhart, head of the site’s works council, said allocating a high-volume electric vehicle to Neckarsulm could help secure its future.
Audi has been hit by falling sales in the once-lucrative Chinese market and a lack of U.S. manufacturing capacity, leaving it exposed to tariffs.
Last year, it announced plans to cut up to 7,500 jobs in Germany by 2029, mainly in administration and development.
Local mayor Steffen Hertwig warned that closing Neckarsulm would have far-reaching consequences for the southwestern state of Baden-Wuerttemberg, a traditional automaking region where Mercedes-Benz, Porsche and supplier Bosch have also come under pressure.
“It would be a disaster,” Hertwig told Reuters, warning of a domino effect in the region.
The number of ships transiting the Bab el-Mandeb Strait on Tuesday reached the highest level since July 19, preliminary shipping data showed on Wednesday.
Thirty-nine commodity ships passed through the waterway on Tuesday, while five transited on Wednesday, according to ship-tracking data from analytics firm Kpler, with only a few transiting through the Strait of Hormuz.
Two of the five ships exiting the Bab el-Mandeb on July 29 were carrying crude oil, including very large crude carrier (VLCC) Sophia and the Aframax tanker Ocean Laureate.
Separately, of the 39 ships passing through on July 28, 20 ships entered the strait while 17 exited, the data showed.
Among those exiting, three were Aframax tankers carrying crude. The Aisopos and Gustav exited to the Gulf of Aden, each carrying more than 750,000 barrels of oil, while the Karachi is carrying around 430,000 barrels of crude bound for Pakistan.
Of the ships that entered, two were tankers carrying petrochemical products. The Velos Aquarius is carrying 345,000 barrels of methyl tertiary butyl ether, a type of gasoline blendstock, for delivery to the west of Suez and the Sea Ambition is carrying nearly 93,000 barrels of chemicals bound for Türkiye.
Some ships could still be sailing with their transponders turned off.
Yemen’s Houthis said on Tuesday they fired ballistic missiles at a Saudi oil tanker in the Red Sea, stepping up enforcement of a newly declared maritime blockade of Saudi Arabia. That followed earlier attacks on Saudi Arabia’s oil sites. China has held direct talks with the Houthi movement to enable its tankers to sail through the Red Sea, sources have said.
Only eight commodity ships passed through the Strait of Hormuz on Tuesday, with five entering and three exiting, Kpler data showed, while one passed through on Wednesday so far.
VLCC Nissos Kea, currently empty, was one of the five ships entering the Strait on Tuesday.
Iran, meanwhile, has reportedly ruled out Oman’s proposal for regional joint management of the Strait of Hormuz, hitting hopes of a swift diplomatic breakthrough in the war.
The rogue agent that escaped from OpenAI and carried out a days-long hacking spree at AI company Hugging Face also breached a customer at another tech firm, New York-based Modal Labs, a report said Tuesday, citing a Modal executive and two other sources familiar with the matter.
Modal executives emphasized that the company itself was not hacked. According to a timeline published by Hugging Face on Tuesday, the rogue agent broke into a sandbox, or an isolated testing environment, “hosted on a third-party provider’s infrastructure” before turning it into a launchpad for the broader hack.
The third-party provider was not named in the blog post, but Modal’s chief technology officer, Akshat Bubna, said the agent exploited vulnerable code written by a customer that was hosted on Modal’s platform.
Modal said the customer had “published an unauthenticated endpoint that allowed anyone on the internet to use their sandboxes for code execution” – the digital equivalent of leaving a door open on the internet.
“Modal’s platform or isolation were not compromised in any way,” Bubna said.
Although the compromise of a Modal customer was just an initial step in the wider hacking campaign against Hugging Face, it shows that the rogue agent roamed further afield than was previously known.
OpenAI declined to comment specifically on the hack of one of Modal’s customers, instead referring Reuters to an update in which the company said that its rogue agent had broken into four accounts at four separate services.
OpenAI did not identify those services, but a person familiar with the matter identified Modal as one. The company said it had not identified “any other activity at the level of severity or scale of what we’ve shared related to Hugging Face, which involved a platform-level compromise.”
The early July intrusion at Hugging Face, carried out by an out-of-control agent that OpenAI was testing, drew global attention, evoking science-fiction scenarios of artificial intelligence run amok.
Last week, Reuters reported that OpenAI did not notice that its agent had gone haywire until well after the threat was contained and the FBI was alerted. OpenAI said at the time that there were inaccuracies in the Reuters reporting but did not elaborate.
The company said in its Tuesday update that it had taken the AI model being tested and “deactivated, encrypted, and restricted it from research access.”
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