Financial Times: Kirkuk produces close to 400,000 barrels a day, which makes up almost 10 per cent of total Iraqi production. Therefore, the Iraqi central government risks losing its position as the second-largest producer in Opec to Iran were Kurdistan to declare independence.

The KRI is said to hold 45bn barrels of crude reserves, or around a third of Iraq’s total reserves. They are currently producing around 650,000 b/d, of which 550,000 b/d is exported through Turkey to Mediterranean loading terminals.

So why is the oil market shrugging off this controversial referendum that could formally split and divide Opec’s second-largest producer?

Firstly, if the referendum is held and leads to a Yes vote in most of the areas including Kirkuk, it would not immediately lead to an independent Kurdistan.

Whilst Kurdish officials have said that the vote is binding, they have also stated that the vote will be followed by serious negotiations with Baghdad before a formal independence declaration, which could take several years >>>