Iraq Under Pressure: Sanctions on Iranian Gas Threaten Energy Supply

Iraq faces an impending energy crisis as President Trump ends its sanctions exemption for Iranian gas imports. The country has relied on Iranian gas for about 40% of its electricity supply, and the termination of this exemption could have dire consequences. Efforts are underway to diversify energy sources, including agreements with Turkmenistan and a solar power project with TotalEnergies, although challenges persist in implementation.

Iraq is on the brink of an energy crisis as President Donald Trump has decided to terminate its exemption from sanctions on Iranian gas and electricity imports. This executive order is intended to curb Iraq’s ability to use the US financial system to bypass these sanctions while preventing Gulf countries from acting as conduits for Iranian energy exports. The initiative is part of a larger strategy aiming to reduce Iranian oil exports to zero, including shipments to China, under the reinstated “maximum pressure” campaign.

In light of these developments, Iraq has been preparing for several months by signing contracts with various companies and countries to address the impending sanctions and the potential lockdown of its eastern border. Bassem Naghimash, a member of the Iraqi Parliament’s Oil and Gas Committee, expressed concern about Iraq’s lack of diversification in gas sources amidst the ongoing dependency on Iranian gas imports.

While alternatives such as Jordan, Turkmenistan, and Qatar have been mentioned, there are challenges in securing these options due to insufficient financial and logistical support from the government. Committee member Kazem Al-Touki pointed out that proposed deals, like those with Qatar, have been hindered by infrastructure limitations and US sanctions impacting intermediary companies.

In conclusion, Iraq’s energy sector faces significant risks due to the termination of sanctions waivers affecting Iranian gas and electricity imports. The country is exploring alternatives and implementing measures to diversify its energy sources, but challenges remain in terms of infrastructure and government support. Collaborative efforts with neighboring states and investments in renewable energy may provide Iraq with avenues to mitigate its dependence on Iranian energy as it navigates these sanctions effectively.

Original Source: www.intellinews.com