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Story by Reuters

Oil exports from northern Iraq fell by around 44,000 barrels per day (bpd) in August to an average of 472,832 bpd due to disruption of the pipeline to Turkey, the Kurdistan region’s ministry of natural resources said on Thursday.

The pipeline was down for nine days in August “due to events in Turkey beyond the KRG’s (Kurdistan Regional Government) control”, the ministry of natural resources said in a statement on its website.

The pipeline, which is the autonomous region’s main economic lifeline, has been repeatedly sabotaged since the end of July, when a ceasefire between Turkey and militants from the Kurdistan Workers’ Party (PKK) broke down.

The KRG has blamed “organised gangs” linked with the PKK for the sabotage, which it said last month had cost the region $501 million.

Exports via the pipeline to Turkey have steadily increased this year, but the Kurds began cutting allocations to Iraq’s state oil marketing firm SOMO in June to increase their own independent crude sales.

That has effectively undone a deal reached last November whereby the Kurds agreed to transfer an average of 550,000 bpd to SOMO in 2015 in exchange for the full reinstatement of budget payments from Baghdad.

In August Kurdistan transferred just 50,935 bpd to SOMO , compared with 71,017 bpd the previous month, the ministry of natural resources said in the statement.

The oil pumped through the pipeline comes mainly from fields within the Kurdistan region, which accounted for 353,510 bpd in August. The rest came from the disputed Kirkuk field, which is operated by Iraq’s state-run North Oil Company (NOC).

The fall in Iraq’s northern exports combined with a 40,000 bpd drop in the south, where the bulk of the country’s crude is produced and shipped, led to a decline in OPEC output from its highest monthly level in recent history.