The Biden administration may approve a sanctions waiver on Tuesday that will allow Iran to access at least $10 billion in previously frozen funds held in Iraq, a closely watched decision that comes just a month after the Tehran-backed terror group Hamas launched an attack on Israel that left 1,200 dead.
The waiver would extend the multibillion-dollar sanctions relief first issued in July that expires tomorrow. It allows Iraq to transfer frozen electricity payments into Iranian-owned bank accounts in Europe and Oman. The waiver renewal is driving concerns that the Biden administration is maintaining financial avenues for Tehran as the country’s terrorist proxies foment chaos across the Middle East.
“The world is living in a post-Oct. 7 world, but the White House is still running an Oct. 6 policy toward Iran,” Richard Goldberg, a senior adviser at the Foundation for Defense of Democracies and sanctions expert who previously served on the White House National Security Council, told the Washington Free Beacon, referring to Hamas’s attack last month. “Why should Iran have any access to more than $10 billion after sponsoring one of the worst terrorist attacks against American citizens and the worst massacre of Jews since the Holocaust? It would make more sense to freeze all of these accounts and keep every penny out of Tehran’s hands.”
A senior Iranian official said Monday that $10 billion worth of frozen Iranian funds in Iraq will be deposited at the Trade Bank of Iraq (TBI) and used to purchase goods that are exempted from US sanctions.
Yahya Ale Eshaq, head of the Iran-Iraq Joint Chamber of Commerce, was quoted as saying by Iran’s state media that there are “no obstacles or problems” in financial exchanges between the two neighboring countries, calling the current phase a “strategic opportunity.”
He cited Iraqi officials as saying that the frozen funds will be transferred to the TBI and added that the two sides agreed the money would be used to purchase non-sanctioned commodities such as medicine.
The $10 billion had been owed by the Iraqi government to Iran primarily for imports of natural gas and electricity. Due to US banking sanctions on Tehran, Iraq has not been able to make direct payments.
The development comes a month after the Iranian official announced that Iraq had agreed to release $2.7 billion in gas and electricity debt after receiving a sanctions waiver from the US.