The United States extended a sanctions waiver that critics denounced as identical to continuing to fund Iran’s disruptive activities as its proxies attack U.S. forces across the Middle East.
Rep. Mike Waltz, R-Fla. in an interview with Fox News, stated, “It is absolutely outrageous the Biden Administration continues to find ways to send Iran money, especially from Iraq, where the same Iranian-backed militias who are targeting American forces increasingly run the show and are helping keep Iraq addicted to Iranian energy,”
Secretary of State Antony Blinken approved an extension to the initial 120-day waiver that allowed Iraq to pay for Iranian electricity through an escrow account, where it has deposited an estimated minimum amount of $10 billion, all without fear of reprisal for potentially violating any U.S. sanctions.
The waiver permits the payments as long as they go through Oman, where a portion is converted to euros or other widely-traded currencies for Iran to purchase non-sanctioned products such as humanitarian aid. The State Department has insisted, as it did with the $6 billion held in Qatar, that the money could only be spent with U.S. approval.
The department ended up quietly re-freezing the Qatar-held funds.
A senior State Department official told reporters that the waiver “isn’t a free pass for all this money to move,” arguing it is “a layered and cumbersome process with significant reputational risk.”
The 120-day waiver, extended in July and again on Tuesday, continues a program of waivers going back to 2018 to provide Iraq access to roughly 40% of the energy it imports from Iran.
“Involving these entities that are well known to us, that we do a lot of outreach and coordination with, make us feel even more comfortable above the letter of the law. There is more oversight from a lot of different entities that don’t want these funds to be misused for a variety of different reasons,” the official explained.
Foundation for Defense of Democracies senior advisor and coordinator for the Trump administration’s maximum pressure campaign on Iran, Richard Goldberg, said that the State Department issued the waiver as a balance for Iran agreeing to keep uranium enrichment below a 90% threshold – the point at which it reaches weapons-grade levels.
“An initial report from Reuters said the U.S. has authorized Iran to make a $2.76 billion payment to pay off various debts out of its cash sitting in Iraq, or bulk of that was debt to Turkmenistan for gas, and then also some various international organizations dues, other things that were not itemized at the time,” Goldberg cited about the last Iraqi waiver in July.
“Maybe there’s going to be a gas-for-oil swap if the U.S. allows,” he continued. “The Iraqis are claiming that they’ve achieved that. Then there are reports where the Iranian side is saying, actually, the U.S. has authorized the Iranians to use the more than $10 billion that’s sitting in escrow in Baghdad. Everybody is focused on the $6 billion, but nobody noticed the $10 billion over here,” he added. “They are today.”
Critics argue that the Biden administration should look to cut off or freeze access to all such accounts for Iran, which has carried out dozens of attacks against U.S. military personnel and allies across the Middle East.
“This move by the administration is abhorrent and reprehensible. Money is fungible, and the administration should know better.” Sen. Steve Daines, R-Mont., stated.
“We should not be giving Iran one cent because it will be used to fund Hamas, Hezbollah, and the Houthis. All enemies of Israel and the United States,” Daines added.
The State Department referred reporters to its Tuesday press conferences when asked for comment.