US sanctions Iraq deputy oil minister over Iran oil sales

The U.S. Treasury’s Office of Foreign Assets Control (OFAC) placed Iraq’s Deputy Oil Minister Ali Maarij al‑Bahadly on its sanctions list on Thursday, accusing him of helping Iran bypass oil export restrictions [2]. The move targets al‑Bahadly’s alleged role in diverting Iraqi oil products to an Iran‑affiliated smuggler, Salim Ahmed Said, who was himself sanctioned last year for falsifying Iraqi oil shipments to hide Iranian crude [2].

OFAC said al‑Bahadly used his positions—first as head of the Iraqi parliament’s oil and gas committee and later within the Ministry of Oil—to facilitate the diversion of Iraqi oil to benefit Said’s scheme [2]. The scheme allegedly involved forged documents from Iraqi officials that legitimised the illicit trade, allowing Iranian oil to be sold under the guise of Iraqi product [2]. Treasury Secretary Scott Bessent warned that “the Iranian regime is pillaging resources that rightfully belong to the Iraqi people,” and pledged to keep pressuring Tehran as talks on a broader U.S.–Iran deal show only tentative progress [2].

The sanctions also named three leaders of Iran‑backed militias—Kata’ib Sayyid al‑Shuhada (KSS) and Asa’ib Ahl al‑Haq (AAH)—as part of a broader effort to hold them accountable for attacks on U.S. personnel and civilians [2]. Washington’s action is notable for targeting a sitting Iraqi government official, a rarity that underscores its intent to curb Iran’s influence over Iraq’s oil sector as the country navigates the formation of a new government under prime‑minister‑designate Ali al‑Zaidi [2].

By sanctioning al‑Bahadly, the United States aims to tighten the economic noose around Iran’s ability to fund its regional activities through illicit oil sales. The effectiveness of the measure will hinge on Iraq’s response and whether it can curb the networks that enable such smuggling, a question that looms as Tehran and Washington continue tentative negotiations over a wider sanctions relief.