A classified Iraqi intelligence document obtained by MBN says oil smuggling networks have grown into an integrated system moving crude and fuel from the Kirkuk oil fields and the Kurdistan Region east through Iran to Afghanistan, and north to Turkey.
An Iraqi Interior Ministry colonel confirmed the authenticity of the document to MBN but declined to provide further information, citing “the sensitivity of the matter.”
The findings reach beyond lost revenue for Baghdad. According to the document, smuggled Iraqi crude is blended in Iran with Iranian petroleum products, and the mix is documented as Iraqi to evade sanctions. It is the second such document MBN has obtained in a week. The first, published Monday, detailed oil theft in an area south of Baghdad controlled by Kataib Hezbollah, an Iran-backed militia the United States designates as a terrorist organization.
Iraqi Parliament Speaker Haibat al-Halbousi has ordered a temporary parliamentary committee to investigate oil smuggling from that area, the Kirkuk oil fields and the Kurdistan Region.
The 14-page document, classified “Top Secret,” was prepared by an Iraqi geospatial intelligence unit. It draws on satellite imagery from 2021 through the summer of 2026 showing a sharp rise in tanker trucks and facilities on both sides of the border.
The document says these networks exploit border areas near Turkey and Iran “that lie outside the central government’s control,” adding that they “threaten the state’s sovereign revenues.”
Through Iran to Afghanistan
According to the document, the eastern route begins at the North Oil Company fields in Kirkuk. Crude shipped under official quotas to Sulaymaniyah in the Iraqi Kurdistan Region is diverted onto tanker trucks and moved into Iran through the Bashmakh and Parwez Khan crossings. Lower prices make Iraqi crude “more attractive for smuggling and re-export,” the document says.
In Iran, Iraqi crude is refined and its derivatives processed and sometimes blended with lower-quality products to reduce costs.
The document calls blending “the most important step.” Smuggled Iraqi oil is mixed with large quantities of Iranian petroleum products, and the mix is then documented as an Iraqi product for export and to evade sanctions.
Iranian tanker trucks carry the fuel via the Mahirud crossing in Khorasan province or other crossings to Afghanistan, where private importers sell it to fuel stations for domestic use rather than re-exporting it, according to the document.
(The four preceding satellite images: Development of the tanker gathering site on the Iranian side of the Bashmakh crossing, July 2022–June 2026)
Satellite images in the document show the tanker yard on the Iranian side of the Bashmakh crossing growing from a largely empty lot in 2022 to a crowded depot with new tanks and warehouses by 2026.
At the Parwez Khan crossing, a few scattered vehicles in a March 2021 image give way to hundreds of tanker trucks lined up in nearby fields by late 2025.
(Satellite images: Parwez Khan crossing, March 2021, November 2025, and January 2026)
To Turkey
The second route heads north. The document says tanker trucks unload into storage tanks at the Fishkhabour field in Duhok province. The tanks are operated by Norway’s DNO, the field’s largest investor.
(A map of the tanker trucks route from Fishkhabour in Iraq to Turkey)
The document accuses the company of marketing and selling quantities of oil from the Tawke and Fishkhabour fields to local buyers outside the framework of the federal State Oil Marketing Organization (SOMO). It says this “has resulted in part of the oil production being traded outside the officially approved marketing channels.”
DNO did not respond to a request for comment sent by MBN via email.
From Fishkhabour, the oil is trucked to Turkey through the Ibrahim Khalil crossing, where it is sold “as Iraqi oil.”
That matters because only Baghdad, through SOMO, has the legal authority to sell Iraqi crude abroad. The Kurdistan Region of Iraq has extensive oil reserves of its own but has long resented Baghdad’s control over oil exports and revenues.
The Kurdistan Regional Government began exporting crude on its own to Ceyhan in Turkey in 2014, but Iraq’s Federal Supreme Court ruled that practice unconstitutional in 2022, and an international arbitration panel ruled that Turkey had violated a 1973 pipeline treaty by importing Kurdish oil without Baghdad’s consent.
The KRG was prevented from exporting oil to Turkey for more than two years, until a September 2025 deal allowed Kurdish crude to be sold through SOMO. However, disputes between Baghdad and the KRG over revenue sharing continue to simmer.
The report describes Fishkhabour as a “key logistical hub” along this route, where products are blended and shipping documents are “reissued or falsified” in preparation for export to Turkish territory.
(Satellite images show waiting areas at the Ibrahim Khalil crossing in four snapshots taken between June 2023 and July 2026. Clusters of tanker trucks, outlined in yellow, line up at the same location)
The document ties this route to DNO’s financial dispute with Baghdad and Erbil. The company wants guarantees that it will be paid what it is owed, according to the report. DNO has said it hands the KRG’s share, about 20% of its fields’ output, to the federal government for export while selling its own share, about 64%, to local buyers.
Recommendations
The report’s authors recommend a financial audit to trace the money, identify who profited and establish how much the Iraqi government lost.
The document does not give an estimate of how much revenue Iraq has lost to the smuggling in the Kurdish area. The report on the Jurf al-Sakhar smuggling network said only that operation was causing “substantial losses and clear damage to the country’s oil sector.”
It also recommends putting tanker trucks in Duhok, Erbil, Sulaymaniyah and Kirkuk on the Oil Ministry’s GPS tracking system and taking legal action against any truck operating without one.
