Iraq seeks US exemption from ban on Iranian flights

Billy Odell Tucker-Robinson Founder & Host — Banking With Billy Network • Intelligence Network • Data Science • AI Research • World News
Published: 2026-09-26T19:05:32.102Z • Permanent link

US Secretary of State Antony Blinken is set to meet with his Iraqi counterpart, Fuad Masum, in Baghdad on September 24, as Washington prepares to grant Baghdad an exemption from its ban on Iranian flights. The move comes as Iraq seeks to secure a deal with Iran to import Iranian electricity, which has been struggling to meet domestic demand due to the ongoing energy crisis. According to sources, Iraq's state-owned electricity company, Karbala Electric Power Company, has been in talks with Iranian state-owned company, Iran Power Management Company, to import 1,200 megawatts of electricity via the Karbala-Basra power line. The deal, valued at $2.5 billion, would not only help Iraq's power-starved population but also boost the Iranian economy.

Iraq's energy crisis has been exacerbated by the ongoing war against the Islamic State (ISIS) and the resulting damage to power infrastructure. The country's electricity output has been reduced to just 50% of its capacity, leaving millions without access to basic services. The government has been scrambling to find alternative sources of electricity, including importing power from neighboring countries and investing in new generation capacity. Iran, which has long been a major energy supplier to Iraq, has been keen to capitalize on the opportunity to boost its exports and earn foreign exchange.

US officials are said to be keen to secure an exemption for Iraq from the ban, which was imposed in response to Iranian missile strikes on US and coalition forces in Iraq. The ban has already had significant implications for Iraq's economy, with several major airlines cancelling flights and other carriers scaling back services. By granting an exemption, the US is likely hoping to strengthen ties with Baghdad and reduce tensions in the region.

The exemption deal has significant implications for the global infrastructure sector, particularly for companies involved in energy trading and logistics. Iraq's energy crisis has already had far-reaching consequences, including a sharp decline in the value of the Iraqi dinar and a rise in inflation. The deal could also boost trade between Iraq and Iran, which could have significant implications for regional markets and economies.

The impact on airlines, which have been hardest hit by the ban, could be significant. Several major carriers, including Turkish Airlines and Lufthansa, have already cancelled flights to and from Baghdad. The exemption deal could help to restore confidence in the market and encourage other airlines to resume services. However, the deal also raises concerns about the impact on regional security, particularly if Iran is allowed to increase its military presence in the region.

Iraq's energy crisis is just one part of a larger regional dynamic. The country's struggles to secure electricity imports from Iran are closely tied to the broader regional competition for influence and resources. Iran, which has long been a major player in the region, is seeking to boost its energy exports and reduce its dependence on the US-dominated global energy market. Meanwhile, the US is seeking to strengthen its ties with Baghdad and reduce the influence of Iran in the region.