Tensions with US over Iran-aligned politicians come as US has also praised Baghdad for accepting Islamic State prisoners from Syria

The US has threatened to cut Iraq off from its US-based oil sales profits if it includes members of Iranian-aligned paramilitaries in the country’s next government, an Iraqi official confirmed to Middle East Eye

Several reports on Friday indicated that the US is ramping up pressure to keep perceived Iranian allies out of the next government, as political horse trading takes off in Baghdad following the November parliamentary elections.

The Financial Times (FT) first reported the US threat to cut Baghdad off from its supply of dollar deposits, which are kept at the Federal Reserve Bank of New York.

Under an agreement that has been in place since the 2003 US invasion, Iraq stores the proceeds from its oil export sales in the US. Crates of hard currency are airlifted to Iraq each month from the US, giving Washington leverage over Baghdad.

  • cronenthal@discuss.tchncs.de
    2·
    12 hours ago

    Oof, pulling this stunt at this time for such a small reason was a bad idea. Expect orher countries to discreetly start moving deposits out of the US.