The Iraqi government on Tuesday reached a deal with the Kurdish local authorities in the country’s north to exchange oil from the autonomous region for a nearly 20 percent share of the national budget, officials said.

The deal resolves a months-long impasse that had undermined national unity amid the fight against the Islamic State group – a battle in which Iraqi soldiers and Kurdish peshmerga troops have joined forces against the Sunni extremists.

The agreement stipulates that the semi-autonomous Kurdish government will release 550,000 barrels of oil every day to the Iraqi oil ministry, more than half of which will come from the disputed Kirkuk oil fields, according to Iraqi Finance Minister Hoshyar Zebari. […]