US grants Iraq 120-day extension to import Iranian energy

“An additional 120-day waiver was granted to allow Iraq to continue to pay for electricity imports from Iran.”

ERBIL (Kurdistan 24) – The United States has granted Iraq an extension to a sanction’s waiver for the import of energy from neighboring Iran days ahead of a looming deadline of the original agreement.

On Saturday, the US State Department said it had given Iraq a four-month extension, but encouraged the federal government in Baghdad to seek alternative sources of energy.

“An additional 120-day waiver was granted to allow Iraq to continue to pay for electricity imports from Iran,” the State Department said in an emailed statement to Reuters.

It also called on Iraq to “[diversify] energy imports away from Iran.

Iraq relies heavily on Iranian gas to feed several power stations, importing roughly 1.5 billion standard cubic feet per day via pipelines in the south and east.

Washington cracked down on Iran’s oil sector in November, re-imposing a set of sanctions to curtail Tehran’s nuclear program and its influence in several conflicts across the Middle East.

With the sanctions, the US also prohibited other countries from dealing with Iran or purchasing its energy.

In March, the US granted Iraq a 90-day waiver exempting it from sanctions to buy energy from Iran, allowing Baghdad to keep purchasing electricity from its neighbor. 

Earlier in the week, the Iraqi Council of Economy and Investment warned of a pending energy crisis in the country if gas imports from Tehran come to a halt amid the ongoing tensions between the US and Iran.

“Iraq is already facing security, economic, and political strains. Any additional energy crisis will hinder Iraq crippled,” Nada Shakr, a member of Iraq’s economy and investment council, stated.