Monday, June 26, 2023

Iran: Iraq settles gas debt, Turkiye looks to extend supply deal

ByNews Desk- The Cradle 

The US recently provided Iraq with a sanctions waiver to pay over $2 billion in arrears to the Islamic Republic

Iranian Deputy Oil Minister Majid Chegeni revealed on 25 June that the Iraqi Ministry of Electricity has settled all outstanding debts related to gas imports from Iran after getting a sanctions waiver from the US.

However, the official highlighted that problems remain in “transferring money from TBI Bank of Iraq” but did not elaborate further.

This payment is also in line with the two countries’ agreement last May to extend two contracts to supply gas to major power plants in Baghdad and Basra for an additional five years.

According to an unnamed foreign ministry official that spoke with Reuters earlier this month, Iraqi Foreign Minister Fuad Hussein got the clearance to make the payment from US State Secretary Antony Blinken on the sidelines of a security conference in Saudi Arabia.

Iraq’s payment is part of ongoing “de-escalation” talks between US and Iranian officials that seek to unfreeze billions in funds belonging to the Islamic Republic in exchange for new limits on the nation’s nuclear program.

Despite having some of the world’s largest oil reserves, Iraq relies heavily on Iranian gas to fuel its power plants.

On top of this, Iraq is only allowed to receive Iranian energy imports from Iran and pay for them via sanctions waivers that extend up to 120 days, a policy implemented by former US president Donald Trump and kept in place by the Biden White House.

Tehran has recently boosted its energy exports by collaborating with friendly nations, negating the worst effects of the sanctions.

Speaking to reporters on Sunday, Chegeni also revealed that Turkiye has called on Iran to extend a gas supply deal, adding that the two nations are still negotiating this matter.

According to figures released by the Turkish Statistical Institute (TURKSTAT), the trade exchange between Tehran and Ankara in the first five months of 2023 reached $2.2 billion.

In July 2022, Iranian President Ibrahim Raisi and his Turkish counterpart Recep Tayyip Erdogan signed cooperation agreements worth $30 billion annually.

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