US Gives Iraq New Electricity Waiver as Tensions With Iran Rise

(Bloomberg) -- The US has granted Iraq another four-month waiver that will enable the country to continue paying Iran for electricity with money that’s deposited into restricted accounts that can only be used for humanitarian purposes, senior administration officials said on Tuesday.

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This is the 21st waiver granted since 2018, and is meant to help the Iraqi government continue to make progress toward energy self-sufficiency, the officials said, speaking on background to detail the policy. Sporadic outages and unpredictable supplies of electricity have hobbled Iraq’s economy since the U.S.-led invasion in 2003.

The waiver comes at a time of heightened tensions in the region, with Iran-backed militias taking advantage of Israel’s war against Hamas in the Gaza Strip to target US assets and troops in the Middle East, particularly Iraq and Syria.

The Biden administration attracted a lot of Republican criticism when it struck a prisoner-swap deal with Iran and allowed the country access to $6 billion in oil revenue that had been frozen in South Korean banks due to sanctions. Iran has still not been able to spend that money and isn’t likely to be able to anytime soon, the US officials said on Tuesday.

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