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Turkey to fill Kurdish oil shortage

Turkey said it will provide fuel to Iraq's Kurdistan region to make up for a shortage caused by a militant offensive that has shut down the country's biggest oil refinery.

ANKARA: Turkey said on Saturday it will provide fuel to Iraq's Kurdistan region to make up for a shortage caused by a militant offensive that has shut down the country's biggest oil refinery.

Militants led by the Islamic State of Iraq and the Levant (ISIL) have seized a vast swathe of territory in northern Iraq since overrunning the city of Mosul on June 10.

As a result of the fighting, the Baiji refinery in Salaheddin province has been shut down and the supply route to Iraq's semi-autonomous Kurdish region cut off.

The fuel shortage has caused long queues to form at gas stations in Kurdish cities.

Despite coming under under heavy attack from ISIL in recent days, Iraqi government forces still control the Baiji refinery.

But the clashes caused several storage tanks to catch fire, sending jitters through international energy markets.

Turkish Energy Minister Taner Yildiz said on Saturday the shutdown of the refinery has created a daily requirement in Iraqi Kurdistan of 4,000 tonnes of gasoline.

"We have received a request that Turkey meet this need," Yildiz said.

Yildiz said Turkey's state-owned Tupras refinery could meet northern Iraq's shortage, but warned that shipping the fuel by tanker would lead to long queues at border crossings.

Iraq, including Iraqi Kurdistan, is the second-biggest producer of oil among OPEC countries, but the recent unrest has sparked fears its exports could be hit.

Turkey was criticised by the central government in Baghdad when it started to facilitate the transfer of oil pumped from Iraqi Kurdistan to world markets last month.

Baghdad, which insists it has the sole right to develop and export the country's natural resources, has lodged an arbitration case against Ankara, accusing the government of being "driven by greed".

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