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US halts Iraq financing and security ties pending formation of acceptable government

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The United States has suspended all financing activities and security coordination with Iraq until a new government acceptable to the Washington administration is established, according to a report published by Al-Hadath on April 20.

The restriction reportedly includes the regular shipments of cash dollars to the Central Bank of Iraq (CBI).

According to the Saudi-based news channel, the US administration has presented an additional condition for the continuation of security cooperation. Washington is reportedly demanding the disclosure of individuals believed to be involved in bombing attacks targeting the US Embassy in Baghdad.

Meanwhile, the Central Bank of Iraq issued an official statement on Monday denying the allegations reported by Al-Hadath.

The mechanism controlling the flow of foreign currency in the Iraqi economy is based on an arrangement in effect since 2003, established during the tenure of Paul Bremer, the head of the Coalition Provisional Authority.

Under this system, all oil revenues earned by Iraq are deposited directly into an account held at the Federal Reserve Bank of New York. This structure grants the US government the authority to directly determine and oversee the amount of dollars transferred to the Central Bank of Iraq.

Within this framework, the Iraqi Ministry of Finance must submit formal applications to the US Treasury Department to obtain the necessary cash funds. Washington maintains the authority to approve or reject these requests based on its own established criteria.

This critical mechanism, which facilitates the transport of pallets of cash dollars to Baghdad every month, serves a vital function in enabling Iraq to meet essential expenditures such as public sector salaries, food imports, and medical supplies.

The report noted that Washington has previously slowed or reduced the volume of these transfers during periods when it found the Baghdad government’s regional policies to be at odds with its own strategic objectives.

Among the most sensitive issues in this context are the economic sanctions imposed on Iran. For Iraq, Iran is not only one of its most significant trade partners but also the primary supplier of the natural gas essential for the country’s electricity generation.

More than five months have passed since the parliamentary elections in Iraq, yet the office of the prime minister remains vacant. The Coordination Framework (CF), the largest bloc of Shiite parties in parliament, has been unable to reach a consensus on a name for the new premier.

The US administration reportedly opposes the continuation of current Prime Minister Mohammed Shia al-Sudani in his post and is similarly unfavorable toward the return of former Prime Minister Nouri al-Maliki to power.

While the US administration views Maliki as a figure close to Iran, former US President Donald Trump also shared his views on the Truth Social platform following the strengthening of Maliki’s candidacy. Characterizing Maliki’s previous tenure as a period of “poverty and total chaos,” Trump stated that the US would cut aid to Iraq if he were to be re-elected.

The Coordination Framework, which is represented by 185 deputies in the 329-seat Iraqi parliament, is expected to determine its prime ministerial candidate by April 26 in accordance with the legal process.

Middle East

US envoy says Syria interim leader Sharaa seeks Israel normalization

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US Ambassador to Türkiye and Special Envoy for Syria Tom Barrack stated that Syria’s interim president, Ahmed al-Sharaa, wants to normalize relations with Israel.

At the same time, he called for an end to Israel’s military operations in Syria and questioned whether Washington should intervene to halt them.

Speaking at the Global Security Forum held in Doha, Qatar, Barrack said Sharaa had managed difficult circumstances well and was trying to reassure Israel that his government poses no threat.

“I think President Sharaa has done a very good job under very difficult circumstances,” Barrack said, describing the message he believes the Syrian leader is conveying to Israel: “I am not aggressive, I have no problem with Israel, I want relations with Israel to normalize.”

Barrack also urged Israel to stop its operations in Syria, while voicing uncertainty over whether the US should step in to end them:

“It’s time to stop this [Israel’s actions in Syria]. I don’t know if it’s time for the US to intervene to stop it.”

Israel intensified its military operations in Syria following the overthrow of Bashar al-Assad on 8 December 2024. Israeli forces entered the demilitarized “buffer zone” along the Golan Heights and took up positions on the Syrian side of Mount Hermon (Jabal al-Shaykh), with Israel describing the deployment as a temporary security measure.

Israeli air strikes have also targeted military facilities and weapons depots across the country.

Barrack pointed to Syria’s political transition as an example of how groups once viewed as adversaries could be incorporated into new political and security structures.

“You can take Nusra, which was once designated a foreign terrorist organization; following the transformation that took place on December 8, many people today evaluate this example as ‘here is a model,'” the US diplomat said.

The Nusra Front was a jihadist group that emerged during the Syrian civil war and, after pledging allegiance to al-Qaeda, announced its departure from the network. The organization was designated as “terrorist” by several countries and bodies, primarily the US and the UN.

The group’s leader, Ahmed al-Sharaa (Abu Mohammad al-Julani), subsequently headed Hayat Tahrir al-Sham (HTS), which led the offensive that ousted Assad.

Barrack also highlighted the integration of the Syrian Democratic Forces (SDF) into the Syrian national army as an outcome many had previously considered unlikely.

“Nobody thought you could reintegrate this Kurdish entity, the SDF, into a national army, but it happened,” the US official said.

Damascus and the Kurdish-led forces signed an agreement on 10 March 2025 to integrate the SDF’s military and civilian institutions into the Syrian state.

However, delays occurred in the implementation of the agreement due to disputes over integration terms and the future of self-administration in the region.

Barrack nevertheless expressed doubts about the effectiveness of earlier US interventions in the Middle East, citing Washington’s involvement in what he characterized as “23 regime changes” across the wider region.

“Whenever we have tried to intervene, to change a person or a regime, it seems to have been a mistake,” Barrack said, while also questioning the value of US intervention in Yemen, describing it as apparently “senseless.”

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US and Israel weigh Iran strikes after midterm vote, reports say

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The US and Israeli defence ministries have drawn up plans for a fresh assault on Iran, with the envisioned offensive under consideration to launch after the US Congressional midterm elections on 3 November.

Citing sources, The New York Times reported that the blueprint anticipates a brief but intense campaign.

As military units step up their drills, US Defence Secretary Pete Hegseth discussed prospective strike options with Israeli Prime Minister Benjamin Netanyahu.

The list of targets encompasses Iran’s nuclear sites, its energy infrastructure, and its arsenals of missiles and unmanned aerial vehicles.

Several officials who spoke to the newspaper argued that a new wave of attacks could deal a heavy blow to the Iranian economy, forcing the leadership in Tehran into concessions.

Conversely, other sources doubt whether a resumption of fighting would prove any more successful than the earlier campaign conducted between February and April.

That previous offensive drove energy prices higher and drained US stockpiles of interceptor missiles.

It remains unclear whether US President Donald Trump will authorise the operation.

Domestic political calculations in Israel could also influence the trajectory of the plans, given that the country faces general elections on 27 October.

While some experts speaking to the newspaper contended that Netanyahu could leverage the threat of war to form a national unity government, others pointed to the opposition’s distrust of the prime minister.

Washington fears regional spillover

The US administration also harbours concerns that the fighting could engulf the wider region. On Wednesday, the US State Department ordered non-essential government personnel and their family members to leave Saudi Arabia following attacks by the Iran-backed Houthis.

A US military build-up, comprising three aircraft carriers, fighter aircraft, and special forces units, is slated to be fully deployed to the region by early November.

The targets under review include the deep underground nuclear facility code-named “Pickaxe”. Trump suggested that the high-yield GBU-43/B bomb, known as the “mother of all bombs”, could be deployed against the site, though experts doubt whether the ordnance can destroy a complex buried so deeply.

For its part, Tehran is preparing for a potential escalation, threatening to broaden its target list. Retaliatory options under consideration by Iran reportedly include data centres and subsea internet cables, in addition to shipping and energy facilities.

Mehdi Mohammadi, an adviser to an Iranian negotiator, dismissed US hopes of wrapping up a new campaign within 72 hours as a “fantasy”. Mohammadi warned that Tehran’s response would be more severe and unpredictable.

The Financial Times previously reported that an Israeli strike on Iran set for 10 October had been called off because the US president was unwilling to risk a broader conflict ahead of the Congressional midterms.

According to that report, the Israeli military had prepared a multi-day assault on nuclear sites, Iranian government targets, power plants, and civilian infrastructure on Netanyahu’s orders. The strikes had been designed to exceed the intensity of the campaign begun in February.

Washington seeks to secure an agreement from Tehran covering both the Strait of Hormuz and its nuclear programme.

“It will either be a deal or a strike,” one source told the Financial Times, adding that an operation could get under way in the coming weeks.

Another official who spoke to the paper suggested that Israeli preparations might serve as leverage to squeeze Iran in negotiations.

Axios also reported that the Pentagon had issued orders to prepare for renewed strikes, though the directive contained no specific date and Trump has yet to take a final decision.

The US and Israel launched their offensive against Iran on 28 February. Iran hit back by targeting US and Israeli assets across the region and curbing vessel transit through the Strait of Hormuz.

Although both sides signed a memorandum of understanding in June that provided for a ceasefire and talks to lift the blockade in the Strait of Hormuz, reciprocal attacks between the US and Iran have persisted.

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Netanyahu trails Eisenkot in Israeli polls despite Trump backing

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As general elections scheduled for 27 October approach in Israel, the opposition camp led by former Chief of Staff Gadi Eisenkot continues to lead Prime Minister Benjamin Netanyahu in public opinion polls.

Survey data published in the Israeli press on 19 and 20 October reveal that the governing coalition has failed to catch the opposition, despite explicit backing from US President Donald Trump.

However, the current distribution of votes documents that neither wing can reach a governing majority on its own.

Neither bloc reaches the 61 seats needed to form a government

According to a survey conducted by Channel 13, if an election were held today, Eisenkot’s bloc would win 51 seats, while the Netanyahu coalition would take 50.

A Channel 12 poll indicates that the gap has widened slightly, projecting 55 seats for Eisenkot’s alliance and 51 for the governing bloc. A minimum of 61 seats is required to form a government in the Knesset, Israel’s 120-seat parliament.

A key factor deadlocking the political arithmetic is the refusal by both sides to form a coalition with parties representing Palestinian citizens of Israel. This stance stands as the most tangible obstacle to securing a parliamentary majority after the election.

Channel 12 data shows that overall voter turnout is expected to remain at 72%. The inclination to head to the ballot box climbs to 81% among opposition voters, compared with 74% measured among Netanyahu supporters.

The same poll notes that Eisenkot has widened his lead over Netanyahu by two further points in prime ministerial preferences.

Yashar party climbs after Gantz bows out

A survey published on the Walla news site shows that the balance shifted after Benny Gantz decided to withdraw his Blue and White party from the race. Following that move, Eisenkot’s Yashar party increased its projected tally to 23 seats, while Netanyahu’s Likud dropped by one seat to 19.

Eisenkot’s party and the “Zionist Opposition” bloc it anchors have remained atop the polls for several months.

In an earlier message of support, Trump praised Netanyahu as “a great fighting prime minister and an even greater partner for peace.” Public opinion polls document that this diplomatic and political backing has not proved sufficient to tip the preferences of the Israeli electorate in favour of the incumbent government.

Support for Ben Gvir rises among young voters

Although Netanyahu’s alliance trails in overall strength, far-right figures within the coalition appear to be expanding their grassroots base. Gauged interest in the Jewish Power party of Israeli National Security Minister Itamar Ben Gvir is climbing, particularly among younger voters.

Speaking to a study conducted by Agam Labs, affiliated with the Hebrew University of Jerusalem, an 18-year-old student described his shifting preference: “I used to think he was a bit crazy, but then I actually looked at what he was saying, and it all made sense.”

Another Israeli citizen stated that Ben Gvir’s push to arm West Bank settlers gave them “room to breathe.”

Ben Gvir is known for leading settler incursions into the Al-Aqsa compound and distributing military-grade rifles to tens of thousands of settlers since 7 October 2023.

Criticized for escalating violence against Palestinians, Ben Gvir has called for starving Gaza, maintaining military operations in Lebanon, and bombing Beirut. The far-right minister’s militaristic stances also find a political constituency across several opposition parties in Israel.

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