Iraq reaches settlement of its debts owed to Iran

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[size=52]Iraq reaches settlement of its debts owed to Iran[/size]

[size=45]The Governor of the Central Bank of Iraq, Ali Al-Alaq, announced that an agreement had been reached on settling Iraq’s debts related to importing natural gas from Iran.[/size]
[size=45]He stressed that there are discussions taking place to organize the import process from the Iranian side, in a way that does not expose Iraq to any problems related to violating sanctions and agreements.[/size]
[size=45]He said, “The Central Bank will reach a clear formula in regulating the trade process, especially since part of it is through barter,” noting that “an agreement was reached to settle the debts incurred by Iraq from Iranian gas imports in a new way through which these amounts will be paid.”[/size]
[size=45]Last July, the United States granted Iraq a 120-day exception to make payments to Iran related to its electricity imports.[/size]
[size=45]Under this exception, payments will be deposited in non-Iraqi bank accounts, provided that the disposal of these funds is restricted and subject to American approval.[/size]
[size=45]Iran had reduced its gas exports to Iraq by more than half until the first of last July, as a result of Baghdad's failure to make late payments, which led to a power outage for longer hours.[/size]
[size=45]Iraq's electricity needs reach 37 thousand megawatts, while it currently produces about 26 thousand.[/size]
[size=45]Iraq owes Iran about $12 billion in arrears on gas and electricity imports over the past years, as electricity and gas imports from Iran represent up to 40% of Iraq’s energy supplies, especially in the summer, when temperatures reach 50 degrees Celsius.[/size]
[size=45]The electricity sector in Iraq is suffering from an ongoing crisis, despite the government spending about 80 billion dollars over the past 20 years.[/size]
[size=45]Amid heavy reliance on Iranian gas to operate power plants, Iraq spends about $4 billion annually on gas and electricity imports from Tehran.[/size]
[size=45]Baghdad failed to achieve self-sufficiency in gas, as most of the gas associated with oil production is burned, causing it to incur $12 billion annually.[/size]
[size=45]According to the World Bank, Iraq is the second worst country in the world in terms of burning gas after Russia, burning more than 17 billion cubic meters in 2020.[/size]
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