Kurdistan based oil firms Gulf Keystone Petroleum Limited (LON:GKP) and Genel Energy PLC (LON:GENL) shares slumped in Monday’s early deals as tensions ratcheted up in Northern Iraq.
Amid reports of violent clashes, GKP was down around 9.5% at 91.50p while Genel had dropped 7.45% changing hands at 124.25p.
Domestic media reports claimed that Iraqi forces had taken over some areas of Kurdish control, including oil fields, although Kurdistan officials are said to have denied the state’s claims.
Additionally, an exchange of artillery fire is said to have occurred near the city of Kirkuk.
The apparent escalations follow a referendum in which the vast majority of the votes backed the semi-autonomous region to become an independent country, though the vote nor its mandate were not recognised by the government in Baghdad.
Political insecurity has been a key risk for investors in Kurdistan based oil stocks for quite some time, and the recent escalations have further dented share prices.