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By John Lee.

The Ministry of Trade has confirmed that Iraq's oil exports to the United States will not be affected by the newly announced 30-percent U.S. tariff, which was introduced by President Donald Trump to address the trade deficit with Iraq.

Trade Ministry spokesperson Mohammed Hanoun said that oil exports are exempt from the new duties, meaning the majority of Iraq's exports to the U.S. remain unaffected.

According to the state-run Iraqi News Agency (INA), Hanoun said that non-oil exports from Iraq to the U.S. are currently minimal, and any impact from the tariffs would be indirect-mainly through potential downward pressure on global oil prices, which could affect government revenues.

(Source: INA)

By Adam Lucente for Al Monitor. Any opinions expressed here are those of the author(s) and do not necessarily reflect the views of Iraq Business News.

From Iraq to Algeria, Trump's looming tariffs could target 4 MENA countries

The United States has a trade deficit with Iraq, Algeria, Libya and Tunisia, according to the US government, prompting the president to send them letters warning of new tariffs.

Click here to read the full article (subscription required).

By John Lee.

The U.S. Department of the Treasury's Office of Foreign Assets Control (OFAC) has announced sanctions targeting networks involved in transporting and purchasing Iranian oil, including a group of companies led by Iraqi businessman Salim Ahmed Said.

The U.S. alleges that Said's network smuggled Iranian oil disguised as, or blended with, Iraqi oil, generating substantial profits while benefiting Iran's Islamic Revolutionary Guard Corps-Qods Force (IRGC-QF), which is designated as a Foreign Terrorist Organization.

Several vessels engaged in the covert delivery of Iranian oil were also sanctioned, as the U.S. continues to crack down on Iran's so-called "shadow fleet" of tankers. The actions aim to increase economic pressure on Tehran and disrupt its access to revenue that could fuel destabilising activities.

Treasury Secretary Scott Bessent stated, "While Iran has had every opportunity to choose peace, its leaders have chosen extremism. Treasury will continue to target Tehran's revenue sources and intensify economic pressure."

The latest designations were made under Executive Orders 13902 and 13224, which target key sectors of the Iranian economy and entities supporting terrorism. The U.S. Department of State also announced sanctions on six entities and four vessels for significant transactions involving Iranian petroleum products, under Executive Order 13846.

More background on this story can be found here.

Full statement from the U.S. Department of the Treasury:

Treasury Targets Diverse Networks Facilitating Iranian Oil Trade

Today [3rd July 2025], the U.S. Department of the Treasury's Office of Foreign Assets Control (OFAC) is taking action against networks that have collectively transported and purchased billions of dollars' worth of Iranian oil, some of which has benefited Iran's Islamic Revolutionary Guard Corps-Qods Force (IRGC-QF), a designated Foreign Terrorist Organization. Among the entities sanctioned today is a network of companies run by Iraqi businessman Salim Ahmed Said (Said) that has profited from smuggling Iranian oil disguised as, or blended with, Iraqi oil. Treasury is also sanctioning several vessels engaged in the covert delivery of Iranian oil, intensifying pressure on Iran's "shadow fleet."

"As President Trump has made clear, Iran's behavior has left it decimated.  While it has had every opportunity to choose peace, its leaders have chosen extremism," said Secretary of the Treasury Scott Bessent.  "Treasury will continue to target Tehran's revenue sources and intensify economic pressure to disrupt the regime's access to the financial resources that fuel its destabilizing activities."

Today's action is being taken pursuant to Executive Order (E.O.) 13902, which targets those operating in certain sectors of the Iranian economy, including Iran's petroleum and petrochemical sectors, as well as the counterterrorism authority E.O. 13224, as amended.  It marks the eighth round of sanctions targeting Iran's oil trade since the President issued National Security Presidential Memorandum 2, directing a campaign of maximum pressure on Iran.

Concurrently, the Department of State is designating six entities and identifying four vessels pursuant to E.O. 13846 for having knowingly engaged in a significant transaction for the purchase, acquisition, sale, transport, or marketing of petroleum or petroleum products from Iran.

IRAN-IRAQ OIL SMUGGLING NETWORK

Iraqi-British national Salim Ahmed Said (Said) runs a network of companies that have been selling Iranian oil falsely declared as Iraqi oil since at least 2020.  Said's companies use ship-to-ship transfers and other obfuscation techniques to hide their activities.  Said's companies and vessels blend Iranian oil with Iraqi oil, which is then sold to Western buyers via Iraq or the United Arab Emirates (UAE) as purely Iraqi oil using forged documentation to avoid sanctions.  This allows the oil to be sold on the legitimate market and helps Iran evade international sanctions on its oil exports.

Said has bribed many members of key Iraqi government bodies, including parliament.  He has reportedly paid millions of dollars in kickbacks to these officials in exchange for forged vouchers allowing him to sell Iranian oil as if it originated from Iraq.

Said is being designated pursuant to E.O. 13902 for operating in the petroleum sector of the Iranian economy.

Said controls UAE-based company VS Tankers FZE (VS Tankers), despite avoiding formal association with the company.  Formerly known as Al-Iraqia Shipping Services & Oil Trading FZE (AISSOT), VS Tankers has smuggled oil for the benefit of the Iranian government and the Islamic Revolutionary Guard Corps (IRGC).  For example, in 2020, AISSOT reportedly brokered a deal to transport Iranian oil via Iraqi pipelines to be blended and sold as Iraqi oil.

VS Tankers-affiliated ships have assisted Iranian oil exporters in blending Iranian oil with Iraqi to obscure the oil's origins by engaging in ship-to-ship transfers with vessels known to be affiliated with Iranian oil activities. VS Tankers currently claims several oil tankers as part of its fleet, one of which recorded four ship-to-ship transfers with the U.S. sanctioned, Barbados-flagged CASINOVA (IMO 9280366) in April 2024 while located in the Persian Gulf near the mouth of the Shatt al-Arab river, which marks the border between Iraq and Iran. VS Tankers has served as the operator, manager, and beneficial owner of the Marshall Islands-flagged crude oil tanker DIJILAH (IMO 9829629) since 2019.

VS Tankers is being designated pursuant to E.O. 13902 for operating in the petroleum sector of the Iranian economy.  DIJILAH is being identified pursuant to E.O. 13902 as property in which VS Tankers has an interest.

In 2023, Said expanded his business holdings to include VS Oil Terminal FZE (VS Oil), which, though registered in the UAE, has its physical presence in Khor al-Zubayr, Iraq.  VS Oil manages six oil storage tanks where Iranian oil is dropped off to be mixed with Iraqi oil.  Vessels carrying Iranian oil also conduct ship-to-ship transfers with vessels carrying Iraqi oil in the vicinity of VS Oil's terminal facilities, and the blended oil is ultimately authenticated by complicit Iraqi government officials.  Vessel tracking data shows that multiple oil tankers known to transport Iranian petroleum products on behalf of U.S.-sanctioned Iranian oil and petrochemical broker Triliance Petrochemical Co. Ltd. and Iranian military front company Sahara Thunder have visited VS Oil.  VS Oil employees smuggle hard currency into Iran via cars and trucks, some of which carry millions of dollars each, as payment for oil.

VS Oil is being designated pursuant to E.O. 13902 for operating in the petroleum sector of the Iranian economy.

Said also owns UAE-based VS Petroleum DMCC, formerly Ikon Petroleum DMCC, and Rhine Shipping DMCC (Rhine Shipping) which, in 2022, were implicated in blending Iranian oil to sell as Iraqi oil.  Rhine Shipping was also previously exposed as the manager of the U.S.-sanctioned oil tanker MOLECULE, formerly named BABEL, which loaded oil in the Persian Gulf from an Iranian tanker that had turned off its location transponder to obfuscate the transaction.  OFAC subsequently sanctioned the MOLECULE for its role in shipping Iranian oil as part of the network of Iran-backed Houthi financial official Sa'id al-Jamal.

Said also owns United Kingdom-based companies The Willett Hotel Limited and Robinbest Limited.

VS Petroleum DMCC, Rhine Shipping, The Willett Hotel Limited, and Robinbest Limited are being designated pursuant to E.O. 13902 for being owned or controlled by, directly or indirectly, Said.

Shadow fleet actors

Iran's shadow fleet enables the regime to transport its petroleum to generate revenue.  Iran relies on non-sanctioned vessels to conduct ship-to-ship transfers and receive Iranian oil from sanctioned vessels before shipping the Iranian-origin cargo to buyers in Asia.

The National Iranian Tanker Company (NITC) uses Singapore-based Trans Arctic Global Marine Services PTE. LTD. (Trans Arctic Global) to arrange piloting services for NITC vessels transiting through the Strait of Malacca.  Trans Arctic Global has enabled NITC to transport tens of millions of barrels of Iranian oil through the Strait of Malacca for eventual ship-to-ship transfers to vessels waiting in the Singapore Eastern Outer Port Limits.

Trans Arctic Global is being designated pursuant to E.O. 13902 for operating in the petroleum sector of the Iranian economy.

The Cameroon-flagged VIZURI (IMO 9197909), Comoros-flagged FOTIS (IMO 9306548), and Panama-flagged THEMIS (IMO 9264570) and BIANCA JOYSEL (IMO 9196632), have collectively shipped tens of millions of barrels of Iranian oil and other petroleum worth billions of dollars.

Since mid-2023, the VIZURI has completed multiple shipments of Iranian oil and transported millions of barrels of Iranian oil.  Panama-flagged liquified petroleum gas carrier (LPG) FOTIS has transported millions of barrels of Iranian LPG and other petroleum to multiple locations.  Panama-flagged THEMIS, which was sanctioned by the United Kingdom on May 9, 2025 for transporting Russian oil, has also transported Iranian oil.

Seychelles-based Egir Shipping Ltd, and Marshall Islands-based Fotis Lines Incorporated and Themis Limited are the respective owners of the VIZURI, FOTIS, and THEMIS.  Egir Shipping Limited, Fotis Lines Incorporated, and Themis Limited are being designated pursuant to E.O. 13902 for operating in the petroleum sector of the Iranian economy. VIZURI, FOTIS, and THEMIS are being identified as blocked property in which Egir Shipping Ltd, Fotis Lines Incorporated, and Themis Limited, respectively, have an interest.

Panama-flagged BIANCA JOYSEL has transported more than ten million barrels of Iranian oil since mid-2024, conducting ship-to-ship transfers with sanctioned vessels owned by the U.S.-designated NITC, including the AMOR and STARLA.

British Virgin Islands-based Betensh Global Investment Limited And Dong Dong Shipping Limited owns the BIANCA JOYSEL.  Betensh Global Investment Limited And Dong Dong Shipping Limited is being designated pursuant to E.O. 13902 for operating in the petroleum sector of the Iranian economy.  BIANCA JOYSEL is being identified as blocked property in which Betensh Global Investment Limited And Dong Dong Shipping Limited has an interest.

IRGC-QF oil Sales

The IRGC-QF has used the Al-Qatirji Company to facilitate oil sales to customers around the world, generating hundreds of millions of dollars of revenue for the IRGC-QF.  The Cameroon-flagged ELIZABET (IMO 9216717), which has impersonated a separate vessel, the S TINOS, loaded a cargo of Iranian oil off the coast of Malaysia in August 2024 via ship-to-ship transfer.  The cargo had originally been loaded at Kharg Island, Iran, by the ROMINA (IMO 9114608), a vessel previously identified for its role in transporting Iranian petroleum for the Al-Qatirji Company.  Seychelles-based White Sands Shipmanagement Corp. is the ship manager, operator, and technical manager of the ELIZABET.

The AI-Qatirji Company transported approximately two million barrels of Iranian oil on the Cameroon-flagged ATILA (IMO 9262754) in support of the U.S.-sanctioned Sa'id al-Jamal network.  The ATILA received the oil in a ship-to-ship transfer with the sanctioned vessel ARMAN 114. The Iranian oil carried by the ATILA was disguised as Malaysian oil.  Seychelles-based Grat Shipping Co Ltd is the manager, operator, and owner of the ATILA.  OFAC designated Sa'id al-Jamal pursuant to E.O. 13224, as amended, on June 10, 2021, for having materially assisted, sponsored, or provided financial, material, or technological support for, or goods or services to or in support of, the IRGC-QF.

The Al-Qatirji Company has also used the Palauan-flagged GAS MARYAM (IMO 9108099) to transport Iranian petroleum products in support of the IRGC-QF.  Liberia-based Dima Shipping & Trading Company is the manager, operator, and owner of the GAS MARYAM.

White Sands Shipmanagement Corp, Grat Shipping Co Ltd, and Dima Shipping & Trading Company are being designated pursuant to E.O. 13224, as amended, for having materially assisted, sponsored, or provided financial, material, or technological support for, or goods or services to or in support of the Al-Qatirji Company.  The ELIZABET is being identified as blocked property in which White Sands Shipmanagement Corp. has an interest, the ATILA as blocked property in which Grat Shipping Co Ltd has an interest, and the GAS MARYAM as blocked property in which Dima Shipping & Trading Company has an interest.

SANCTIONS IMPLICATIONS

As a result of today's action, all property and interests in property of the designated or blocked persons described above that are in the United States or in the possession or control of U.S. persons are blocked and must be reported to OFAC.  In addition, any entities that are owned, directly or indirectly, individually or in the aggregate, 50 percent or more by one or more blocked persons are also blocked. Unless authorized by a general or specific license issued by OFAC, or exempt, OFAC's regulations generally prohibit all transactions by U.S. persons or within (or transiting) the United States that involve any property or interests in property of blocked persons.

Violations of U.S. sanctions may result in the imposition of civil or criminal penalties on U.S. and foreign persons.  OFAC may impose civil penalties for sanctions violations on a strict liability basis.  OFAC's Economic Sanctions Enforcement Guidelines provide more information regarding OFAC's enforcement of U.S. economic sanctions.  In addition, financial institutions and other persons may risk exposure to sanctions for engaging in certain transactions or activities involving designated or otherwise blocked persons.  The prohibitions include the making of any contribution or provision of funds, goods, or services by, to, or for the benefit of any designated or blocked person, or the receipt of any contribution or provision of funds, goods, or services from any such person.

Furthermore, engaging in certain transactions involving the persons designated today may risk the imposition of secondary sanctions on participating foreign financial institutions.  OFAC can prohibit or impose strict conditions on opening or maintaining, in the United States, a correspondent account or a payable-through account of a foreign financial institution that knowingly conducts or facilitates any significant transaction on behalf of a person who is designated pursuant to the relevant authority.

The power and integrity of OFAC sanctions derive not only from OFAC's ability to designate and add persons to the Specially Designated Nationals and Blocked Persons List (SDN List), but also from its willingness to remove persons from the SDN List consistent with the law.  The ultimate goal of sanctions is not to punish, but to bring about a positive change in behavior.  For information concerning the process for seeking removal from an OFAC list, including the SDN List, or to submit a request, please refer to OFAC's guidance on Filing a Petition for Removal from an OFAC List.

Click here for more information on the persons designated and any property identified as blocked today.

(Source: U.S. Department of the Treasury)

By Robert S. Ford for The Middle East Institute. Any opinions expressed here are those of the author(s) and do not necessarily reflect the views of Iraq Business News.

Iraq tries to assert state authority during crisis

The Iraqi government has long navigated a path between maintaining political ties with its Iranian neighbor and Tehran's allies inside Iraq on the one hand, and preserving its security relationship with the United States on the other.

Unsurprisingly, it quickly welcomed US President Donald Trump's June 23 Israel-Iran cease-fire agreement.

Click here to read the full article.

By John Lee.

Irish-based Petrel Resources last week issued unaudited preliminary results for the year ending 31 December 2024.

The company, which announced a fundraising in March, said that it has submitted a proposal to undertake contractor obligations on a relinquished block from Iraq's 4th Bid Round, and has also prepared an updated development plan for the Merjan oil field. The company said it sees opportunities in recovering flared gas and liquids.

Full statement from Petrel Resources:

Highlights

Market overview

• 2024 set consumption records for oil and LNG consumption, but oil prices fell in early 2025 due to the 'Trump tariff war' triggering fears of reduced demand.
• Uncertainty increases risk and delays investment decisions.
• Available fiscal terms, however, reflect the boom conditions between 2003 and 2014 rather than current market conditions.  States have been slow to update contractual terms to align interests, which deters development.
• Oil explorers are not yet attracting strong investor interest in western markets.  Majors buy shares back and issue dividends rather than invest the c. $610 billion necessary to supply future demand. 

 Assets overview

•  In Ghana, ratification discussions with the Ghanaian authorities on Tano acreage have re-commenced - though acreage adjustments are likely, and governance remains an issue.
•  In Iraq, there may be early opportunities to recover gas and liquids currently being flared.
•  Petrel submitted a proposal to undertake contractor obligations on a relinquished Block from the 4^th Bid Round [Block 8].
•  An updated Merjan oil field development proposal has been prepared.
•  Iraqi oil output was c.4 million barrels daily in Spring 2025, with export growth constrained by contractual terms and OPEC+ agreements.
•  Petrel seeks direct negotiations, where possible, rather than bid rounds, which are expensive and high risk, thus inappropriate for juniors.

 Outlook

The board is considering expansion opportunities in oil & gas, and energy-related projects worldwide. Our group participates in the EU Commission's Critical Resource Minerals' Initiative, which offers attractive diversification given current market conditions.  We offer an established record and potentially high liquidity and capital appreciation for the right story.  As investors re-focus on 'hard industries' and cash flow, this is a time of opportunity.

Recent months remind investors of some eternal truths: market uncertainty has increased, amid armed conflict and trade wars.  Western dependence on Chinese processing of Critical Resource Minerals means that efforts to reduce dependence on fossil fuels will not reduce exposure to distant sources and supply chains.

Policy-makers have discovered the limits of their bold dreams of a Green transition: energy costs have risen rather than fallen.  The new technologies bring new headaches: electricity storage turns out to be prohibitively expensive for grid-scale coverage.  EVs continue to penetrate markets but are price-competitive only in China.  But developed economies prefer to protect their automotive sectors rather than import cheap Chinese EVs.  In such policy myopia lies the roots of the next oil boom.

Like all previous energy transitions, Green sources turn out to be additive to rather than replacing traditional, reliable fuels - which will continue to dominate the 21^st century:

During 2024/25 there were a serious of close-calls, power failures, and brown-outs globally, culminating in the Iberian black-outs of April 2025. These were not the routine power failures common in the global south, or planned "load-shedding" in South Africa. 

These power failures were caused by over-dependence on intermittent renewable generation, allied with inadequate investment in legacy grids designed for centralised, reliable world-scale plants fuelled traditionally by coal, and then increasingly by nuclear and natural gas.  The failure was not that of renewable generation per se, since hydro-power or geothermal generally provide reliable supplies. 

The problem was with unpredictable intermittent generation, which produces Direct Current, rather than Alternating Current, and consequently does not deliver significant inertia to protect against periodic interruptions.  Battery storage, is expensive and would require vast quantities of Critical Resource Minerals to adequately back a grid up.  Traditional storage methods such as hydro are available for only a small percentage of demand.  It turns out that the intermittent renewable generation on which the "Green transition" relies is only suitable for up to 30% of demand which is the natural surplus in electrical systems.  Beyond that point, costs and risks soar.

This means that Natural Gas will continue to dominate electrical generation, both directly, and as essential back-up for the reliability modern economies require.  In price-sensitive markets, coal will continue to dominate.  Nuclear power is also an effective solution, but involves bureaucratic planning requirements, up-front costs, and is opposed politically in some developed societies.

Consumption data bear this out: recent years have seen record demand for oil and even coal.  LNG is now 55% of total traded gas, helped by malicious damage to pipelines and the time needed to extend more gas pipelines to Asian consumers.

Markets are always transitioning, which is why an average 3.75% global economic growth translates into only 2.1% energy consumption growth due to greater efficiencies.  But every energy transition in history has added new fuels rather than substituted them.  Legislators are unlikely to achieve what market forces cannot.

And yet there has been a dramatic under-investment in reliable energy exploration & development since 2014.  This is also true even of those Critical Resource Minerals necessary to fuel the new industries, which include Copper and Nickel as well as Lithium, Cobalt and the other 50-odd minerals.

To maintain adequate oil & gas supplies the world needs about $610 billion of investment (depending on materials' costs and rig-rates), but the industry invests only c.$360 billion - much of it in existing properties and basins of super-majors and National Oil Companies.  There has been little frontier exploration since 2015.  Most of the developing world is starved of investment.  Instead, producers prefer to issue dividends and buy shares back.

Part of the reason is that politicians also display myopia about how to deliver effective exploration.  Risk-investors require a risk-adjusted rate of return.  The higher the uncertainty, the more return investors require.  Best results are achieved by aligning interests, and linking taxes to profits, rather than requiring up-front payments, or royalties.

Formal bid rounds, involving up-front fees, qualification criteria designed for majors, and limited upside, are not how you expedite projects, keep cost control and optimise reservoir recovery.  That is why Petrel prefers direct negotiations, where possible, after which we can bring partners via farm-ins.

But our industry is cyclical, and majors' caution offers opportunities for independents - who have always pioneered new approaches, from offshore drilling to fracking.  So far, the emerging supply constraints have not filtered through to exploration & development.  But when they do, there will be a sharp reversal in sentiment, rewarding those farsighted enough to develop attractive acreage ripe for exploitation.

We have received several approaches offering new oil & gas exploration projects but also in Helium and other energy-related projects.  So far, all prospects have fallen short on legal title, price expectations, or financing terms.  There is no value for Petrel shareholders in over-paying.

Petrel is an EU company, and our involvement in the EU Commission's Critical Resource Minerals' "Team Europe" has fostered relationships with industrial buyers, financing institutions and key decision-makers.  There are surprisingly few juniors able to swim in all these seas.

In the meantime, there is market interest in Petrel's strong shareholder following and liquidity - especially at times of intense news-flow.  Accordingly, we continue to explore expansion opportunities.

Financing

There are contrarian investors keen to fund the right project. As during the pandemic and previous times of turbulence, directors and their supporters are open to covering working capital needs, and are prepared to participate in any necessary, future fundings.

(Source: Petrel Resources)

By John Lee.

The Government of Iraq has issued a strong condemnation of what it described as military aggression by Israel against the Islamic Republic of Iran, calling the act a clear violation of international law and the United Nations Charter.

A statement from Government Spokesman Basim Alawadi urged the international community to go beyond verbal condemnations and take practical, deterrent actions.

US Secretary of State, Marco Rubio, denied US involvement in the incident, saying:

"Tonight, Israel took unilateral action against Iran. We are not involved in strikes against Iran and our top priority is protecting American forces in the region. Israel advised us that they believe this action was necessary for its self-defense. President Trump and the Administration have taken all necessary steps to protect our forces and remain in close contact with our regional partners. Let me be clear: Iran should not target U.S. interests or personnel."

On Wednesday, the US Department of State ordered the departure of non-emergency government personnel from its embassy in Baghdad, citing "heightened regional tensions."

Full statement from the Media Office of the Prime Minister:

The Government of the Republic of Iraq strongly condemns the military aggression launched by the Zionist entity against the territory of the Islamic Republic of Iran. This act represents a blatant violation of the fundamental principles of international law and the Charter of the United Nations, and constitutes a serious threat to international peace and security, particularly as it occurred during the ongoing negotiations between the United States and Iran.

The international community must not remain a bystander in the face of this flagrant breach of international law. Invoking the use of force to impose new realities poses a serious threat to the foundations of the modern international order.

The Iraqi government stresses that mere statements of condemnation are no longer sufficient. The international position must be translated into practical and deterrent actions.

Accordingly, the Government of Iraq calls on the United Nations Security Council to convene immediately and take firm and tangible measures to deter this aggression, prevent its recurrence, and restore the authority of the international legal order. Should existing mechanisms prove incapable of fulfilling this role, the international community must begin a serious dialogue on developing alternative frameworks that ensure accountability, enforce justice, and safeguard global peace.

The Iraqi government reaffirms its unwavering commitment to the principles of sovereignty, non-use of force, and the peaceful resolution of disputes. It also expresses its solidarity with the Iranian people and with all peoples and nations who believe in a just international order based on respect for rules rather than their violation, and on the rule of law, not the law of the jungle.

Basim Alawadi
Iraqi Government Spokesman
June 13, 2025

(Sources: PMO, US State Department)

By Michael Knights, for the Combating Terrorism Center (CTC) at West Point. Any opinions expressed are those of the author(s), and do not necessarily reflect the views of Iraq Business News.

Iraqi Oil and the Iran Threat Network

Iran-backed terrorist groups and militias are developing significant new strands of threat financing using Iraq's oil sector, which combine to provide billions of dollars of illicit value each year.

Iraq is thus emerging as Iran's best bet for neutering the Trump administration's renewed maximum pressure campaign.

Click here to read the full report.

To browse our comprehensive library of reports on Iraq, click here.

By Padraig O'Hannelly.

As Donald Trump completes his first 100 days in as US President, what effect have his policies had on the Iraqi economy?

Firstly, it's worth noting that the main implications of Trump's policies for Iraq have been the indirect results of decisions not directly targeted at Iraq. Increased tariffs and the resultant drop in oil prices, the slashing of foreign aid across the board, and Trump's 'maximum pressure' policy towards Iran have been the three biggest consequences for Iraq since the change of regime in Washington on 20th January.

Tariffs and Oil Prices

While the United States applied an additional duty rate of 39 percent to imports from Iraq from 5th April, as part of its wider 'reciprocal tariffs' (sic) policy, the new rate does not apply to US imports of oil, which account for almost all of Iraq's exports to the US.

However, Trump's approach to tariffs in general, combined with his unpredictable nature, has led to fears of a significant slow-down in international trade, and undermined the confidence of investors and consumers worldwide. As a result, the price of Brent crude has fallen from around $75 at the start of the month to $65 today; in mid-2024 it was as high as $85.

These drops imply reduced oil revenue for Iraq. Iraq's National Development Plan 2024-2028, launched last summer, but withheld from the public until late December, assumes a price of $74 this year, for example.

(Source: National Development Plan 2024-2028)

But as our Expert Blogger Ahmed Tabaqchali notes, Iraq has the capacity to support its spending plans by selling government debt, and this in turn can help develop the country's bond market, contributing to the evolution of the capital markets in Iraq. So while reduced oil revenue is a negative for Iraq, many expect short-to-medium-term development to continue as planned.

Foreign Aid

By some estimates, more than half of the humanitarian plans in Iraq were funded by the United States, so it should be no surprise that Trump's freezing of foreign aid and shutting down of the United States Agency for International Development (USAID) would have a major impact on a wide range of valuable initiatives throughout the country.

According to the Washington-based Enabling Peace in Iraq Center (EPIC), "in fiscal year 2023, U.S. assistance to Iraq amounted to $592.7 million." It says the halt in funding and the stop-work order for USAID has already disrupted lifesaving programs in Iraq.

Our Tenders page on Iraq Business News has seen only a small drop in activity, as many international NGOs have been able to continue with their work, but many programs have been cancelled or scaled back.

Sanctions on Iran

The removal of Iraq's waiver from US sanctions on Iranian energy imports has created immediate economic strain, but it has also accelerated efforts to reduce dependence on Iran. The sudden change of policy risks widespread blackouts, particularly during the extremely hot summer months, but it should also be noted that Iran was already expected to have difficulty supplying Iraq this summer, as it struggles to meet domestic energy demand.

To mitigate the effects of this decision, Iraq has prioritised alternative supply projects, including a gas deal with Turkmenistan, increased electricity imports from Turkiye, and the creation of a floating platform for LNG imports. Iraq also plans to have completely stopped the flaring of associated gas by early-2028.

While the cancellation of the waiver will undoubtedly cause hardship over the coming months, the import of gas and electricity from Iran was always regarded as a temporary solution, and pulling forward projects to replace Iranian supply could be considered a worthwhile investment.

Trump withdrew the US from the Joint Comprehensive Plan of Action (JCPOA) in 2018. Discussions continue regarding a possible new deal between US and Iran, and the final shape of any such deal will have implications for Iraq's economy and politics.

Iraqi dinar

Finally, for the benefit of those who've bought Iraqi dinars (IQD) in the hope of stratospheric upward revaluations, it should be mentioned that has, of course, not happened.

There has been a noticeable increase in interest in this "dinar RV" theory since Trump was elected in November, but not a shred of evidence to support the idea, and no indication from the President that he has any interest in the topic.

In an entirely unscientific online survey we ran in January, more than half of respondents said they expected the Iraqi dinar to revalue by at least 1,000x in the first 100 days of Trump's term, as if this was something that the President could magically bring about, even if he wanted to.

Doubtless the adherents to this theory will find a way to explain why it has not happened as they hoped, consider it a 'delay', and focus on some future timeframe when their faith will be rewarded.

© Iraq Business News

By John Lee.

DynCorp International LLC has agreed to pay $21 million to settle allegations under the False Claims Act that it knowingly submitted inflated subcontractor costs to the U.S. State Department while delivering services under the "CIVPOL" contract, which was intended to train Iraq's civilian police forces.

The lawsuit, filed in 2016, accused DynCorp of passing excessive and unsubstantiated charges for lodging, security, translation, and logistics services from one of its subcontractors onto the U.S. government. The company, which was headquartered in Irving, Texas, and Falls Church, Virginia, was acquired by Amentum in 2020.

U.S. authorities said the settlement underscores a zero-tolerance stance toward fraud by federal contractors, particularly in conflict environments. The resolution follows a coordinated investigation by the Department of Justice, the U.S. Attorney's Office for the District of Columbia, and the U.S. Department of State's Office of Inspector General.

DynCorp did not admit liability, and the allegations remain unproven.

Full statement from US Department of Justice:

DynCorp International LLC (DynCorp) has agreed to pay $21 million to resolve False Claims Act allegations that it knowingly submitted inflated subcontractor charges under a State Department contract to train Iraqi police forces, known as the "CIVPOL" contract. DynCorp was a government contractor headquartered in Irving, Texas, and Falls Church, Virginia. Amentum, another government contractor with headquarters in Chantilly, Virginia, purchased DynCorp in November 2020.

The State Department awarded the CIVPOL contract to DynCorp in April 2004 to provide training for civilian police forces in Iraq. DynCorp was also tasked with supplying support for this effort, such as lodging for contractor personnel and various labor services. In a lawsuit filed in July 2016, the United States alleged that one of DynCorp's main CIVPOL subcontractors charged excessive, uncompetitive, and unsubstantiated rates for hotel lodging and guard, translator, driver, and supervisor services, and that DynCorp, contrary to its obligations as a government prime contractor, knowingly passed on those charges to the State Department for reimbursement.

"Federal contractors have a duty be fair and honest when doing business with the government," said Principal Deputy Assistant Attorney General Yaakov Roth of the Department of Justice's Civil Division. "The Department will not tolerate those who use times of conflict and strife to enrich themselves at the expense of the American people."

"As the Trump Administration zeroes in on fraud, waste, and abuse, this office will continue to seek settlements with outside entities that are taking advantage of their U.S. government contract by either not providing what they promised or misusing the funds in other ways," said Interim U.S. Attorney Edward Martin Jr. for the District of Columbia. "This contractor was supposed to train civilian police forces to help the State Department provide some stability for a strategic partner. When you are given a government contract, you are taking money from the American people and this office will make certain you deliver on your promises."

"State Department contractors and subcontractors have a unique opportunity to serve their country and contribute to the safety and security of Americans across the globe," said Assistant Inspector General Robert J. Smolich for Investigations at the Department of State Office of Inspector General. "Today's settlement sends a clear message that those who seek to exploit State Department contracts in order to defraud American taxpayers will be held accountable for their actions."

The resolution obtained in this matter was the result of an effort by the Civil Division's Commercial Litigation Branch, Fraud Section, the U.S. Attorney's Office for the District of Columbia, and the U.S. Department of State's Office of Inspector General.

Trial Attorneys Ben Young and Jeff McSorley and Assistant U.S. Attorney Darrell Valdez for the District of Columbia represented the United States in this matter.

The case is captioned United States v. DynCorp International LLC, Case No. 1:16-cv-01473 (D.D.C.).

The claims resolved by the settlement are allegations only and there has been no determination of liability. 

(Source: US DoJ)

By Michael Knights, for the Washington Institute for Near East Policy. Any opinions expressed are those of the author(s), and do not necessarily reflect the views of Iraq Business News.

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