Iraqi Prime Minister Haider al-Abadi on Monday said that the Islamic State group smuggled most of its oil through Turkey.
A statement from his office said, "(Abadi) stressed on the importance to stop oil smuggling of IS terrorist gangs, of which its majority is smuggled through Turkey," Xinhua reported.
Abadi's comment came during his meeting with German's Foreign Minister Frank-Walter Steinmeier who was on an official visit in Baghdad to discuss bilateral ties and the fight against IS group.
The deterioration in relations between Iraq and Turkey came as Baghdad has accused Ankara of sending additional troops in a training mission to northern Iraq without authorisation from Baghdad.
Earlier reports said that a Turkish training battalion equipped with armoured vehicles was deployed near the city of Mosul, some 400 km north of Baghdad, to provide training to Iraqi paramilitary groups against the extremist IS militants.
According to the statement, Abadi told Steinmeier that "the deployment of Turkish troops inside Iraqi territory is rejected, as it happened without authorization by the Iraqi government, which considered a breach to Iraqi sovereignty."
Mosul, the capital of Nineveh province, has been under IS control since June 2014.
Earlier, Russia accused Turkish President Recep Tayyip Erdogan and his family of involvement in the trade of IS oil, but Erdogan turned the table around on Russia, claiming it is in fact Russia that is involved in oil smuggling with the IS.