Iraq Situation Report: May 27 - June 2, 2020

By Katherine Lawlor and Brandon Wallace

Key Takeaway: Economic and diplomatic competition between the United States and Iran is ramping up as both sides attempt to control the conditions leading up to the US-Iraq Strategic Dialogue in mid-June.  Iran seeks to ensure that Iraq continues to import Iranian energy, a key economic driver for Iran's sanctions-battered economy. Iraq relies on those imports to bolster its under-funded, often-strained electrical grid. The United States is aiming to reduce Iraqi reliance on Iranian imports by encouraging investments by US and allied companies and leveraging its sanctions waivers. Meanwhile, Iraqi Prime Minister Mustafa al-Kadhimi is capitalizing on what appears to be a grace period granted to him by the United States and Iran to work with both sides and secure Iraq’s energy and defense requirements.