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US reduces length of sanctions waiver, increasing pressure on Iraq and Iran

By LOUISA LOVELUCK AND JOHN HUDSON | The Washington Post | Published: November 20, 2020

BAGHDAD — The Trump administration intensified pressure Friday on Iraq and Iran by reducing the length of a sanctions waiver that allows Iraq to power its already overstretched energy grid.

The Trump administration's maximum-pressure campaign against Iran has left Iraq dependent on the rolling waivers, which exempt it from sanctions when it purchases a tranche of Iranian gas and electricity products that account for about a third of its energy needs.

A spokesman for the State Department said Friday that Secretary of State Mike Pompeo had extended the waiver for 45 more days, leaving the Trump administration with a final decision on whether to extend it or cut it altogether before the Jan. 20 inauguration.

Usually, the waivers last 120 days, allowing Iraqi and U.S. officials time to establish how to keep Iraq's lights on. After Pompeo intensified pressure on Iran, that period was reduced to 60 days in the summer.

"The secretary has renewed the sanctions waiver for Iraq to engage in financial transactions related to the import of electricity from Iran," the spokesman said. "The waiver ensures that Iraq is able to meet its short-term energy needs while it takes steps to reduce its dependence on Iranian energy imports."

In practice, the decision deepens pressure on an Iraqi government already under strain from the Trump administration's threat to withdraw its U.S. Embassy from Baghdad. The United States has used the sanctions waiver and embassy pullout as leverage to push Iraqi Prime Minister Mustafa al-Kadhimi to reduce his government's dependence on Iran and weaken the influence of Iran-backed militias in Iraq.

One of those militias broke a months-long pause in hostilities Tuesday by firing a barrage of rockets at Baghdad's heavily fortified Green Zone, where the U.S. Embassy compound is located. A U.S. defense system intercepted the attack midair, and an 18-year-old woman was killed in the crossfire as she left a popular fairground.