WASHINGTON: The United States has ended a sanctions waiver that allowed Iraq to buy electricity from neighbouring Iran, in line with President Donald Trump’s policy of exerting “maximum pressure” on Tehran.

In a statement on Sunday, the State Depart­ment said the decision not to renew the waiver was made to “ensure we do not allow Iran any degree of economic or financial relief.” The move comes two days after Trump said he had written Iran’s supreme leader Ayatollah Ali Khamenei to press for new talks on Tehran’s nuclear programme.

The US president warn­­ed of possible military action if Iran did not give in — a message that prompted Khamenei to reject “bullying” by foreign powers. Iran supplies a third of Iraq’s gas and electricity, providing Tehran with substantial income.

Since returning to the White House in January, Trump has reinstated his policy of exerting “maximum pressure” against Iran.

Tehran supplies a third of Iraq’s gas and electricity, providing the country with substantial income

“The President’s maximum pressure campaign is designed to end Iran’s nuclear threat, curtail its ballistic missile programme, and stop it from supporting terrorist groups,” a spokesman for the US embassy in Baghdad said on Sunday.

The spokesman urged Baghdad “to eliminate its dependence on Iranian sources of energy as soon as possible.” The landmark 2015 deal that Obama helped negotiate between Tehran and major powers promised sanctions relief in return for Iran curbing its nuclear programme.

Tehran, which denies seeking nuclear weapons, initially adhered to the nuclear deal after Trump pulled out of it, but then rolled back commitments.

US officials estimate Iran would now need mere weeks to build a nuclear bomb if it chose to.

‘All scenarios’

Trump pulled out of the agreement over the objections of European allies, instead imposing sweeping US sanctions on any other country buying Iran’s oil. The waiver was extended to Iraq as a “key partner” of the US.

Iraq, despite having immense oil and gas reserves, remains dependent on such energy imports. But Baghdad said it had prepared “for all scenarios” regarding the waiver.

The ending of the energy waiver is expected to worsen the power shortages that affect the daily lives of 46 million Iraqis.

Gulf analyst Yesar Al-Maleki of the Middle East Economic Survey (MEES) said Iraq will now face challenges in providing electricity, especially during summer. To alleviate the impact, Iraq has several options including increasing imports from Turkiye.

Published in Dawn, March 10th, 2025