Iraq’s Kurdistan Regional Government (KRG) has agreed an oil-sharing deal with the disputed territory of Kirkuk, increasing its authority in the region.

Under the deal, the KRG has agreed to deposit $10m a month into a bank account for Kirkuk, according to a statement released by Kirkuk’s Governor Najmuddin Omar Karim on 2 March.

Baghdad was not informed of the agreement, said Saad al-Hadithi, spokesman for Iraq’s Prime Minister Haider al-Abadi, speaking to US news agency Bloomberg.

In 2015, an oil-sharing deal agreed between Baghdad and the KRG collapsed, with both sides blaming the other for failing to keep to the agreement.

Both Baghdad and the semi-autonomous Kurdish region of northern Iraq are in the midst of a financial crisis driven by low oil prices and the high cost of the ongoing war with the jihadist group Islamic State in Iraq and Syria (Isis).