Iraq granted sanctions waiver to buy electricity from Iran

Iraq granted sanctions waiver to buy electricity from Iran
2 min read
08 November, 2018
Chronic power shortages were a key cause of massive protests in Basra during the summer.
Baghdad relies heavily on Tehran for its energy needs [Getty]
The United States has granted Iraq a waiver so it can continue importing electricity from sanctions-hit Iran, a US official said on Wednesday.

Baghdad relies heavily on Tehran to provide it natural gas and Iranian-generated electricity, and feared that supply would be endangered by Washington's measures against Iran's energy sector.

The US State Department's representative on Iran said Wednesday that Iraq had been granted a special permission.

"We granted Iraq a waiver to allow it to continue to pay for its electricity imports from Iran. We are confident that this will help Iraq limit electricity shortages in the south," Brian Hook told reporters in Washington.

"Iraq is a friend and a partner, and we are committed to its stability and prosperity."

Comment: Rethinking future Iran-Iraq energy relations

Iraq is now expected to demonstrate to the US how it would wean itself off Iranian gas, a well-informed Iraqi source told AFP.

Catch up with our weekly round-up from Iraq

"The US gave us 45 days to give them a plan on how we will gradually stop using Iranian gas and oil," the source said.

On Monday, the United States re-imposed tough sanctions on Iraq's financial institutions, shipping lines, energy sector, and petroleum products.

Iraq has a strong relationship with the United States, coordinating on security, politics, and governance.

But its economy is profoundly intertwined with that of Iran, from which it imports consumer goods amounting to around $6 billion (five billion euros) in 2017.

It also pipes in natural gas and 1,300 MW of Iranian-generated electricity to cope with power shortages.

Most of Iraq's 39 million people only get a few hours of state-provided electricity per day and rely on power generators.

Chronic power outages were a key driving factor behind weeks of massive protests in southern Iraq during the summer.