* Iraqi government forces battling militants for refinery
* Iraqi demand for fuel could cause bottleneck at border
* Long queues at petrol stations in northern Iraq
(Updates with Arbil situation, more Yildiz comments)
By Orhan Coskun
MOSCOW, June 19 Iraq's extra demand for Turkish
fuel due to the Baiji refinery attack will strain the limited
border export capacity, Turkish Energy Minister Taner Yildiz
said on Thursday.
Iraqi government forces battled Sunni militants for control
of the country's biggest refinery on Thursday as Prime Minister
Nuri al-Maliki waited for a U.S. response to an appeal for air
strikes to beat back the threat to Baghdad.
Yildiz told reporters during a trip to Moscow that Iraqi
demand for Turkish refined oil products could cause a
bottle-neck at the border with northern Iraq and it was unclear
whether the demand could be fully met.
"This increase in the demand for refined oil products will
cause a build-up of activity at the Habur border gate. Physical
conditions including security concerns will determine whether
the demand can be met," Yildiz said.
In Arbil, the capital of Iraqi Kurdistan which remained
stable amid the increasing violence across the north of the
country, there were long queues at petrol stations due to panic
buying even though there were no actual shortages.
"People are panicking because of the Baiji refinery," one
taxi driver in Arbil said on Wednesday night. "Deliveries are
coming though. There are few shortages."
Officials from the Kurdistan Regional Government (KRG)
visited Turkey in April and started talks on opening five new
border gates to avoid the frequent long queues at Habur.
Turkish Trade Minister Hayati Yazici said last November that
Turkey had agreed with Iraq on opening two new border gates
after talks with Iraq's central government and the KRG.
None of these gates have been so far been opened, leaving
Habur as the only crossing.
OPEC member Iraq was Turkey's biggest crude oil supplier in
2013 and it buys back refined oil products, particularly diesel,
to meet its booming electricity demand.
"This refinery was supplying northern Iraq but now it is
unable to do that. We already supply fuel to the region to a
certain extent," Yildiz said.
Turkey extended a warning to its citizens in Iraq to leave
all but the Kurdish-run north on Wednesday, citing a potential
battle for Baghdad and saying "negative propaganda" was being
spread against it in the Shi'ite-dominated south.
Eighty Turkish nationals were seized by insurgents in the
northern Iraqi city of Mosul last week, 49 of them snatched from
the Turkish consulate, including special forces soldiers,
diplomats and children.
Meanwhile, oil flow at Iraqi Kurdistan's pipeline link to
Turkey continued and a third export cargo shipped to world
markets independently was scheduled to load this weekend.
Yildiz said buying crude oil from the KRG was definitely an
option. "Tupras has not yet bid for this oil but it could in the
(Additional reporting by David Sheppard in Arbil, Writing by
Daren Butler and Humeyra Pamuk, Editing by Nick Tattersall and