Iraq-Iran gas-for-oil barter would likely violate US sanctions

A barter of Iranian natural gas for Iraqi oil as described by the Iraqi Prime Minister this week would likely violate US sanctions on Tehran unless the US issued a waiver permitting it, three former US officials said on Thursday, Reuters reports.

Iraqi Prime Minister, Mohammed Shia Al-Sudani, on Tuesday, said Iraq would begin trading crude oil for Iranian gas to end recurring payment delays to Tehran due to required US approval for such transactions.

Sudani said Iran had cut gas exports to Iraq by more than half as of 1 July after Baghdad failed to secure US approval to disburse owed funds, but Tehran had now agreed to resume gas exports in exchange for crude oil.

There are few details available about the potential barter, which could help defuse a political problem for Sudani, since power cuts are unpopular during the sweltering Iraqi summer when temperatures can top 50 Celsius (122 Fahrenheit).

However, three former US officials said barter would likely run afoul of US sanctions.

“It would be a violation of US sanctions to conduct this kind of a barter transaction with Iran absent a US national security waiver being issued,” said Richard Goldberg of the Foundation for Defence of Democracies think tank.

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