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The United States has imposed sanctions on a top Iraqi official who is accused of helping Iran sell oil and fund attacks on US military personnel in the region.
Getting into it: The announcement was made by the Treasury Department, which designated Iraq’s Deputy Minister of Oil Ali Maarij al-Bahadly Thursday along with three senior leaders of Iran-aligned militias Kata’ib Sayyid al-Shuhada (KSS) and Asa’ib Ahl al-Haq (AAH), both of which the US has designated as Foreign Terrorist Organizations. According to the Treasury’s Office of Foreign Assets Control (OFAC), al-Bahadly let an Iran-linked smuggler named Salim Ahmed Said (sanctioned by Treasury back in June 2025) blend Iranian crude with Iraqi crude at the VS Oil Terminal in Khor Zubayr, then push it out to buyers around the world as if it were 100% Iraqi.
Al-Bahadly allegedly signed off on shipping millions of dollars in oil per day out of Iraq’s Qayyarah field and provided forged documentation that legitimized the illicit oil. Said himself was the one paying off officials inside Iraq’s government and was reportedly behind installing al-Bahadly in his position to begin with.
Treasury Secretary Scott Bessent framed the move as protecting Iraq from Iranian exploitation. In a statement, he said, “Like a rogue gang, the Iranian regime is pillaging resources that rightfully belong to the Iraqi people. Treasury will not stand idly by as Iran’s military exploits Iraqi oil to fund terrorism against the United States and our partners.”
Iraq’s Oil Ministry pushed back hard against the accusations, saying it welcomed any fair probe into the matter and that oil exports, marketing, and tanker loading aren’t even part of al-Bahadly’s portfolio. Iraq’s Oil Minister Hayan Abdel-Ghani had separately confirmed in March that Iranian tankers intercepted by the US in the Gulf were carrying fake Iraqi paperwork, though Iran denied using such documents.
This all comes as the Trump administration has been ratcheting up pressure on Iraq to break with Iran-backed militias, with the Wall Street Journal reporting last month that Washington had cut off certain shipments and frozen parts of its security cooperation with the Iraqi military. Those militias have launched more than 600 attacks on US facilities in Iraq since October 2023.
