US says dollar shipments to Iraq ‘temporarily paused’

WASHINGTON D.C.- The US State Department said Friday that dollar shipments into Iraq “were temporarily paused.”

“We can confirm that U.S. dollar shipments into Iraq were temporarily paused,” a State Department spokesperson told Rudaw in a statement, without elaborating on its duration or scope.

The Wall Street Journal reported on Wednesday that the US had suspended a cargo-plane delivery of nearly $500 million in banknotes from Iraqi oil sales held at the Federal Reserve Bank of New York and frozen some security cooperation programs.

The developments come weeks after a security incident on April 8, when US Embassy Baghdad personnel were targeted in multiple drone attacks near Baghdad International Airport. According to a State Department official speaking to Rudaw at the time, the attacks were carried out by an Iraqi “terrorist militia.” All US personnel were reported safe.

Washington condemned the attacks and called on the Iraqi government to investigate and hold those responsible accountable.

“The United States has temporarily suspended some security assistance activities with Iraq. Counterterrorism cooperation that enhances U.S. national security continues,” the Friday statement added.

The financial advisor to the prime minister, Mazhar Mohammed Salih, told Rudaw’s Hastyar Qadir on Wednesday that the issue was linked to reduced flights and airport closures, not a shift in US policy. Salih said electronic transfers for commercial purposes, which account for the majority of dollar flows, remain unchanged and unaffected.

Salih also told state media that "this halt is temporary and short-term, linked to operational circumstances that do not reflect a malfunction in monetary policy or in the general availability of foreign currency."

Meanwhile, US Congressman Joe Wilson, speaking to Rudaw on Thursday, emphasized the need to curb Iranian influence in Iraq as the country navigates ongoing political developments, including efforts to form a new government.

Iraqi pro-Iran armed groups were involved in Tehran’s retaliation against the US and Israel following their campaign against Iran on February 28, with several factions from the Tehran-led ‘Axis of Resistance’ claiming responsibility for attacks on alleged US targets in the region, including in Iraq and the Kurdistan Region.

During a Friday meeting of Iraq’s ruling Shiite Coordination Framework to nominate the country’s next premier, Abu Ala al-Wala’i, leader of the Kata'ib Sayyid al-Shuhada (KSS), was present. Earlier that day, the US Department of State’s Rewards for Justice program announced a “reward of up to $10 million for information” on him, describing KSS as “an Iran-aligned terrorist group in Iraq.”

“My main interest in Iraq… is to eliminate Iranian influence,” Wilson said, adding that recent regional shifts could create an opportunity for political change. “It should energize the people of Iraq to establish a fair and free government.”

Wilson also pointed to the role of armed groups aligned with Tehran, saying “the main thing truly is to eliminate the Iranian influence, whether it be by militia groups or whether by intimidating political figures.”

“One of the consequences… is going to be the liberation finally, of Iraq,” Wilson added.


Updated at 11:59 pm.