US-Iraqi ties have witnessed an improvement over the past few months, largely in the energy and defense sectors that are key components of the bilateral relationship. These positive developments, however, are threatened by the undiplomatic and sometimes menacing comments
by US Ambassador to Turkey and Special Envoy to Syria Thomas Barrack, who seems to go out of his way to share his often-inflammatory personal views. He has conducted himself similarly in Lebanon, where he has also incurred controversy. Although a new US special envoy to Iraq is now in place, it remains to be seen whether the Donald Trump administration has the diplomatic wherewithal and sensitivity to deal with an Iraqi government that is playing a delicate balancing act between the United States and Iran.
Energy Sector Assistance and Multiple Deals
Washington played an instrumental role in the September 2025 reopening of a pipeline from Iraq’s Kurdistan region to Turkey’s port of Ceyhan, which had been shut in March 2023 when the International Chamber of Commerce in Paris ruled in favor of the Iraqi federal government, stating that Turkey had violated a treaty by allowing the Kurdistan Regional Government (KRG) to market the oil independently. Turkey was compelled to obey the ruling, which had the effect of cutting off these oil exports from the KRG. In July 2025, a preliminary agreement on a deal was reached, and in late September oil exports from this region started to flow again from the pipeline.
The two-and-a-half-year-long closure of the pipeline had deprived the KRG of a good share of oil revenue and the world market of 400,000–450,000 barrels per day (b/d) of oil. According to Reuters, US government involvement in ending the dispute aimed to help American oil companies in the KRG that had been adversely affected by the closure, to bring down the global price of oil, and to prevent the diversion of “crude oil south, feeding smuggling networks that generate huge sums for Iran and its proxies.” Representatives of the Trump administration also reportedly threatened top Iraqi energy officials with sanctions if the pipeline was not reopened.
American companies have recently reentered the Iraqi market due to the Iraqi government’s improvement of commercial terms.
This is not the only region in Iraq where American energy companies have been involved. In August 2025, the Iraqi government signed a contract with Chevron to explore in existing and new fields and to initiate a gas venture with another firm. In October 2025, Iraq signed three major oil deals with American companies, including a deal with ExxonMobil to develop the Majnoon oil field, one of the largest in the world. In late October 2025, Excelerate Energy, another US company, signed an agreement to build Iraq’s first floating liquefied gas platform in the Khor al-Zubair port.
The reasons why American companies have recently reentered the Iraqi market include the Iraqi government’s improvement of commercial terms to attract top firms (allowing for profit-sharing, for example) and its reduction of red tape and corruption in the energy sector. American oil and gas companies notably account for roughly 80 percent of all US economic activity in Iraq.
The government led by Prime Minister Mohammad Shia’ al-Sudani also seems eager to court US energy companies, not only to protect himself against US sanctions but also to curry US support, especially in the Trump era. In the words of a member of Iraq’s governmental advisory team, Baghdad is seeking the support of the Americans because “they remain the ultimate decision-makers globally.”
Security Sector Assistance and the Issue of US Troops
US troops reentered Iraq in 2014 in the wake of the military advances of the so-called Islamic State (IS). Although by 2019 IS had lost its territorial holds in Iraq and Syria, cells have remained active in both countries, necessitating a continued, albeit diminished, US presence.
The issue of US troops in Iraq has been contentious in the country, not only because nationalist-minded Iraqis see it as an infringement on sovereignty but also because pro-Iran Shia militias view US troops as hindering their freedom of movement and action. Sudani has played a delicate balancing act, defending the need for Iraq’s partnership with coalition forces to defeat the IS threat while his allies call for their withdrawal. He has gone as far as saying that the Iraqi government can disarm the militias only when the United States pulls out its forces.
During the Joe Biden administration, there were approximately 2,500 US troops in Iraq. In September 2024, Washington and Baghdad reached an agreement whereby the number would be reduced and the mission curtailed. In the first phase, which ran from September 2024 to September 2025, the United States departed from some longstanding bases in Iraq and started to leave from the large Ain al-Asad base in western Iraq and from Baghdad International Airport. Many of these forces have since been moved to Hareer base in the KRG. In the second phase now underway, the US troop presence is supposed to end sometime in 2026 and the United States will transition to a bilateral security relationship with Baghdad. An Iraqi official suggested, however, that US troops in Hareer might stay on after the 2026 deadline.
US troops in Iraq outside of the KRG may indeed stay longer to support operations against IS. In October 2025, Sudani told foreign reporters that events in Syria had changed the 2024 agreement, saying: “To operate, manage, and monitor some operations targeting ISIS on the Iraq-Syria borders as well as co-ordination with Al-Tanf base [in Syria], an agreement has been reached to maintain a unit of 250 to 350 advisors at Ain al-Asad.” Underscoring the sensitivity of a continuing US troop presence in Iraq, however, Sudani emphasized that Ain al-Asad base “is under the control of the Iraqi security forces, especially the Iraqi army.”
The presence of US forces at Hareer base is not controversial in Iraq’s Kurdistan Region, because the KRG sees US troops as a protective shield. The fact that the United States just opened its largest consulate in the world in Erbil, at a cost of nearly $800 million, suggests that it plans to stay in this region for some time, based on the expectation that the US military presence will not be a political lightning rod there.
The fact that the US just opened its largest consulate in the world in Erbil suggests that it plans to stay in this region for some time.
The need for such a presence became evident in late November 2025 when two armed drones attacked the Khor Mor gas field in the KRG. Local officials blamed pro-Iran Shia militias for the attack, which led to power outages in much of the Kurdistan Region. KRG leaders called it a terrorist attack and asked for international support, particularly for air defense. Sudani also condemned the attack, although his government’s December 2025 investigative report on the incident did not name the perpetrators, presumably out of fear of provoking them.
The mostly Shia Popular Mobilization Forces (PMF) continue to play an outsized role in Iraq, with Kata’ib Hezbollah, a militia closely aligned with Iran, the most radical and powerful among them. As an example of its strength and clout, when Iraq’s top judiciary official announced on December 20, 2025, that the leaders of the PMF had agreed to cooperate on the issue of the state having a monopoly on weapons, Kata’ib Hezbollah objected, stating that its “weapons will remain in the hands of its fighters” and underscoring that it would only discuss giving up arms when foreign troops leave the country.
Undiplomatic Diplomacy
In the midst of these developments, comments by Special Envoy Barrack may have damaged US-Iraqi relations. President Trump has allowed Barrack to broaden his portfolio outside of his Senate-confirmed position as US ambassador to Turkey to include serving as the president’s traveling envoy in the Levant. While meeting with Sudani on November 30, 2025, Barrack warned of a “harsh Israeli strike” if Iraqi militias continued to support Hezbollah in Lebanon. He further advised that the United States would not intervene to stop such a strike. Barrack also reportedly told Sudani that Israel’s operations in Lebanon would continue “until Hezbollah is disarmed.”
The status of Lebanon’s Hezbollah is especially sensitive among some of Iraq’s Shia, as illustrated by a recent about-face by the Iraqi government. In November 2025, the Iraqi government listed Hezbollah and Yemen’s Houthis as groups whose assets should be frozen. When word of this decision became known, Kata’ib Hezbollah denounced the Iraqi government as one that “lacks the dignity to represent its people or defend Iraq’s sovereignty.” On December 4, 2025, Sudani said publicly that the listing had been a mistake and clarified that only the assets of individuals and entities linked to Al Qaeda and IS were to be frozen.
Barrack met with Iraqi Foreign Minister Fuad Hussein several days later at the international gathering of the Doha Forum, where he made even more controversial remarks. In an interview, Barrack criticized past US policies in Iraq for creating a political structure that allowed armed groups to have more power than parliament. He told the interviewer that Sudani is a “very good prime minister” but that he has “zero power” in that he cannot form a coalition in parliament as the representatives of the militias are blocking him. Barrack also said that “decentralization has never really worked anywhere in this region,” adding that the United States, after spending trillions of dollars and losing thousands of lives in Iraq, wound up with “decentralization [in Iraq] which is now a big issue.” He went on to claim that the United States had “balkanized” both Iraq and Syria after the overthrow of Baath Party rule and suggested that the KRG had “no interest” in being part of a federal Iraq.
At a December 7, 2025, meeting with Barrack, Foreign Minister Hussein expressed the Iraqi government’s “surprise” over the US envoy’s comments and said Iraq’s political development was based on the country’s “democracy and the federal system” that are enshrined in the constitution and that “have become a firmly established path with no alternative.”
Recommendations for US Policy
For the past several years, under Presidents Biden and Trump, the United States has worked relatively well with Sudani, generally viewing him as a competent prime minister trying to juggle Iraq’s interests amidst pressures from Tehran and Washington. Although the United States wants to see a prosperous and stable Iraq that is not beholden to Iran, it has understood Sudani’s predicament and has provided Iraq with sanctions waivers. (In March 2025, Trump ended the waiver that allowed Iraq to import electricity directly from Iran but kept in place the waiver that allowed Iraq to import natural gas from the Islamic Republic that is used to make electricity).
Weaning Iraq away from Iran and allowing American oil companies to take part in expanded oil and gas exploration in Iraq would seem to be a much more prudent approach than having someone like Barrack lecture to Iraqis in a condescending way. It also seems prudent to wait for the Iraqi federal government to be stronger politically, economically, and militarily before it can take on the pro-Iran militias. That Sudani has delayed the departure of US troops from Ain al-Asad base suggests that he is in the pocket of neither Iran nor the militias.
Trump’s new special envoy to Iraq, Mark Savaya, would do well to avoid echoing Barrack’s controversial comments and instead should express support for Iraq’s sovereignty, development goals, federal system of government, and nascent democratic institutions like its parliament. He should also avoid the perception that Washington is insisting that Baghdad crack down on the militias, as any public statements in that regard are likely to backfire. Many Iraqi Shia, as well as Iraqis of other sectarian and ethnic backgrounds, want their country to be free of these radical pro-Iranian militias, but they also want to avoid another round of bloodletting. Patience and tactful diplomacy will work better than condescending remarks.
The views expressed in this publication are the author’s own and do not necessarily reflect the position of Arab Center Washington DC, its staff, or its Board of Directors.
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