Iraqi officials defended Thursday a deal inked this week to barter oil for gas with Iran, saying it does not violate U.S. sanctions on Tehran but will help alleviate a worsening electricity crisis in Iraq.
The remarks come as the government in Baghdad struggles to balance between its two key allies, Washington and Tehran. A previous arrangement in which Iraq was buying gas from Iran and paying dollars for it was held up because Washington declined to approve sanctions waivers. That in turn led Iran to cut the gas supply, triggering severe power shortages in Iraq.
After decades of electricity shortages because of war, corruption and mismanagement, oil-rich Iraq has become heavily reliant on imported Iranian gas to meet its electricity needs. The shortages in recent months are in part due to U.S. restrictions on transferring funds to Iran.
Imports from Iran are especially vital during the scorching summer months when Iraqis are forced to pay for private diesel generators or suffer through temperatures that often exceed 50 degrees Celsius (122 degrees Fahrenheit).
Washington has granted some exemptions to its sanction on Iran over Tehran’s disputed nuclear program to allow Iraq to meet its energy needs.
