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Iraq Gets U.S. Approval To Clear $2.76 Billion Gas Debt To Iran

  • Iraq has been given a sanctions waiver by the U.S., allowing it to release $2.76 billion of Iranian funds from gas export payments, according to Yahya Al-e Eshaq, Chairman of the Iran-Iraq Joint Chamber of Commerce.
  • These funds are expected to meet the demands of the Central Bank of Iran and ensure the purchase of necessary goods, which may help stabilize the foreign exchange market.
  • This development follows recent "proximity talks" between Iranian and U.S. negotiators in Oman, suggesting potential deescalation and future discussions on a new nuclear agreement.
Gas

The Iran-Iraq Joint Chamber of Commerce Chairman, Yahya Al-e Eshaq, announced on June 10 that Iraq has released $2.76 billion worth of Iranian funds in gas export money owed by Baghdad. Iraq received a sanctions waiver from the US to make the payment.

According to an unnamed foreign ministry official that spoke with Reuters, Foreign Minister Fuad Hussein got the clearance to make the payment from US State Secretary Antony Blinken on the sidelines of the Riyadh Conference on Thursday.

Eshaq told Iranian media on Saturday that the released funds will meet the Central Bank of Iran (CBI) demands and ensure the purchase of goods needed in the country. He added that the funds could significantly help stabilize the foreign exchange market.

"Part of Iran’s blocked funds in Iraq has been earmarked for hajj pilgrims, and portions have been used for basic goods," the Iranian trade official told local media.

In April, Eshaq said that Tehran and Baghdad had "found several solutions to receive our debt from the Central Bank of Iraq, so Iraq’s outstanding payments to Iran will be cleared gradually within the next three to five months."

The US green light to release the money comes following reports that Iranian and US negotiators recently held "proximity talks" in the Omani capital Muscat, with Omani officials going between them and passing messages.

According to the sources, the talks aimed to deescalate tensions as a basis for future talks on a new nuclear agreement between the parties.

In 2015 Iran and several world powers, including the US, signed the Joint Comprehensive Plan of Action (JCPOA), which placed significant restrictions on Iran’s nuclear program in exchange for sanctions relief.

Washington withdrew from the deal in 2018 and launched a "maximum pressure" sanctions campaign against the Islamic Republic.

After months of talks between Iran and the remaining signatories of the JCPOA, last September — under heavy Israeli pressure — the US put an end to any hope of reviving the deal.

Since then, Iran has restored ties with Saudi Arabia under a Chinese-brokered deal and is reportedly working alongside Gulf countries to form a "naval alliance" to protect the northern Indian Ocean.

Earlier this week, Iranian media reported that $24 billion of Iran’s frozen assets would soon be released from Iraq and South Korea.

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Due to the sanctions on Iran, Iraq is only allowed to receive Iranian energy imports and pay for them via waivers that extend up to 120 days, a policy implemented by former US president Donald Trump and kept in place by Biden. The sanctions have also hampered Iraq’s payments for imports, putting it in heavy arrears.

By Zerohedge.com

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  • Mamdouh Salameh on June 12 2023 said:
    Why does a sovereign nation like Iraq need a sanction waiver from the United States to pay debts owed to Iran like gas supplies and electricity?

    The simple answer is because the United State threatens any country that defies it or doesn’t accept its policies with sanctions.

    That is why the overwhelming majority of countries of the world are aching for a new multipolar World Order and also a new financial system away from the dollar to undermine US hegemony. They don't have to wait much longer.

    As for the proximity talks going on now between the United States and Iran in Oman, they will lead to nothing simply because the views of the two countries are diametrically opposed.

    Iran will never sign a new nuclear deal with the United States and the other P5 countries unless it is on its own terms. And this means that it will never accept any restrictions on its nuclear programme and would insist on the ejection of US forces from Iraq and the entire Middle East.

    Iran is doing very well under sanctions with its crude oil exports averaging an estimated 1.5 million barrels a day (mbd) or 71% of pre-sanction exports having very successfully managed to nullify sanctions.

    Dr Mamdouh G Salameh
    International Oil Economist
    Global Energy Expert

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