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AIPROPX ReportForbes · 4h ago
Washington Wants Iraq, But Tehran And Beijing Won't Let Go
Energy Washington Wants Iraq, But Tehran And Beijing Won't Let Go By Ken Silverstein ,
Forbes contributors publish independent expert analyses and insights. Ken Silverstein analyzes the Energy Transition, AI and Geopolitics Follow Author Aug 02, 2026, 08:45am EDT --:-- / --:-- This voice experience is generated by AI. Learn more . This voice experience is generated by AI. Learn more . Summary Iraq's Prime Minister Ali al-Zaidi recently secured 48 deals worth up to $100 billion with American companies during a US visit, signaling a significant shift towards Western investment in its oil sector. His appointment as a compromise candidate was partly influenced by US opposition to an Iran-aligned predecessor, with al-Zaidi committing to disarming Iran-backed militias. Washington views its commercial presence in Iraq as a national security interest, aiming to stabilize the country and gain influence. However, Iraq faces a complex balancing act, given its deep existing ties with both Iran, which supplies its power grid, and China, a major oil investor and buyer. Expert Ahmed Al-Windi suggests Iraq can maintain careful neutrality, leveraging its position with all three powers. Yet, Washington's active role in shaping Iraq's political landscape and its national security doctrine may ultimately force Baghdad to choose sides, testing its ability to navigate these competing interests.
On July 14, Donald Trump welcomed Iraq's new prime minister, Ali al-Zaidi, into the Oval Office and told reporters the two men had “tremendous chemistry.” Two days later, in Houston, al-Zaidi was shaking hands with executives from Halliburton, Shell, Baker Hughes, Weatherford, and GE Vernova.
I asked Ahmed Al-Windi about that trip during an interview on Cross Lines , the current-affairs program I co-hosted with Bayraq Faisal Ghazi, on Al-Ahad TV. Al-Windi—vice president of the Ghadan Foundation for Risk Management and executive director of the Baghdad International Energy Forum—addressed whether Iraq can take Washington's money without breaking with Tehran and Beijing, the two other powers it depends on.
It isn't a hypothetical. The prime minister holds his job partly because Washington intervened to keep it out of the hands of someone it saw as too close to Iran. Iraq's dominant parliamentary bloc initially lined up behind Nouri al-Maliki , who the Trump Administration viewed as too close to Iran. Prime Minister Al-Zaidi, a businessman with no prior political career, emerged instead as the compromise candidate—and arrived in Washington already committed to disarming Iran-backed militias by September 30, when U.S. troops are set to leave the country.
Al-Windi frames Washington’s logic this way. “Under the United States’ new national-security approach,” he told me, “American assets and interests abroad are increasingly viewed as part of its national security. For Iraq, a larger American commercial presence could therefore give Washington a stronger interest in the country’s stability.”
That's the trade Washington is offering Baghdad: let Chevron and ExxonMobil in, and American self-interest becomes a form of protection. It also means Washington acquires a growing stake in deciding who else gets to operate in Iraq, and on what terms. Is this worth it to Iraq?
Notably, Iraq and Iran fought each other for eight years in the 1980s, a war that killed hundreds of thousands — by some estimates close to a million — on both sides. Since the U.S. invasion toppled Saddam Hussein in 2003 and installed Shia-led governments in Baghdad, Iraq has built deep political, religious, and economic ties with the same neighbor it once fought, including a national electricity grid that has run for years on imported Iranian power and gas.
The first Trump administration granted Iraq a waiver to keep buying that Iranian electricity despite sanctions; the second Trump administration let the waiver lapse in March 2025, part of its broader “maximum pressure” campaign on Iran. Iraq's Ministry of Electricity has warned that losing the parallel gas waiver too would strip out another 30% of the country's power supply.
China's position runs just as deep. Somewhere between half and two-thirds of Iraq's oil production now comes from fields where Chinese companies hold a stake as investors, operators, or field-services contractors, according to the Dutch think tank Clingendael . While the oil belongs to Iraq, it pays foreign firms to develop and run the fields—with Chinese state companies operating many of them.
China has also long been Iraq's largest single buyer of crude oil, though monthly trade figures have swung sharply over the past year.
Iraq found out this year just how exposed that position leaves it. When the U.S. and Israel struck Iran on February 28, 2026, and Tehran closed the Strait of Hormuz in retaliation, Iraq—unlike Saudi Arabia and the UAE, the only two Gulf producers with pipelines that bypass the Strait—watched its own oil exports collapse from roughly 4.5 million barrels a day to a low of 1.4 million in May. That’s purely a result of being a bystander in someone else's war.
So Iraq isn’t weighing an abstraction. It has an Iranian relationship running through its power grid, its parliament, and its armed factions and a Chinese connection running through its wellheads and its export contracts. And it is now trying to layer an ambitious new American relationship on top of both—one that Washington's own doctrine describes as a matter of national security rather than ordinary commerce.
Al-Windi said Iraq doesn’t need to choose a lane. Chinese companies, he argues, “helped maintain Iraqi production at a difficult time and should not now be pushed aside simply because Baghdad is seeking greater Western involvement.” In his eyes, Baghdad has leverage—not potential liabilities.
“China also uses political, economic, and social influence to protect its interests,” he told me. “At the same time, Iraq wants greater participation fro...
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