Iraq’s sanctions waiver renewed for another 120 days

The latest sanctions waiver, which provides an exemption for Iraq to continue its energy trade relations with Iran, is the Biden administration’s second since taking office this January.

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The Biden administration extended Iraq’s sanctions waiver, which allows it to import Iranian gas and electricity, for another 120-day period.

The previous exemption period expired in July. According to an Iraqi government official, the sanctions waiver took effect last week, in conjunction with Prime Minister Mustafa al-Kadhimi’s visit to Washington D.C.

The waiver covers energy imports from Iran to Iraq. Iraq particularly relies on Iranian gas and electricity to supply its already inadequate power sector.

Iraq has experienced prolonged country-wide power outages over the summer, which led to protests in the country’s south.

The US hopes the waivers will provide some leeway for Iraqi officials while they attempt to decrease Iraq’s energy dependency on Iran.

The outgoing Trump administration had granted a 90-day sanctions waiver in early January, whereas the Biden administration renewed the waiver for an additional 120 days, which is the longest period allowed for granting waivers.

The necessity for waivers arose when the Trump administration exited the JCPOA in 2018 and reimposed sanctions on Iran’s energy sector, hoping to achieve a “better deal” with the Iranian leadership. The sanctions included a ban on engaging in energy trade relations with Iran.

The US government at the time granted sanctions waivers to a number of countries, including Iraq, which significantly relied on Iranian energy imports to maintain their electricity output.

Waivers for Iraq have been renewed periodically since.

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