Iraq to discuss with U.S. how to pay Russian energy firms, Iraqi foreign minister says

BAGHDAD (Reuters) – Iraq will discuss with Washington this week how to pay dues owed to Russian oil companies despite sanctions, Foreign Minister Fuad Hussein said on Monday.

“We will discuss this problem with the American side. There are sanctions in place that should not be imposed on the Iraqi side because the cooperation with Russian companies is ongoing and there are active Russian companies in Iraq,” Hussein said during a news conference with visiting Russian Foreign Minister Sergei Lavrov in Baghdad.

Russian investments in Iraq are believed to be worth more than $10 billion, mostly in the oil industry. Huessin said that one of the main issues he and Lavrov talked about was how to pay bills owed to Russian energy companies such as Lukoil and Gazprom that do business in Iraq even though Russia is under international sanctions.

The goal is to “protect Iraqi banks and central banks from sanctions”.

Iraq’s foreign minister is due to fly to the United States on Wednesday to discuss recent tight regulations imposed by the New York Federal Reserve on international dollar transactions by commercial Iraqi banks and their impact on Iraq’s economy, official sources said.

The West, previously Russia’s main energy market, has responded to the invasion of Ukraine by targeting Moscow’s energy revenues through sanctions that also restrict sales to third countries and are set to tighten further.

Hussein stated during a joint press conference with Lavrov that Iraq is calling for peaceful solutions and encouraging dialogue between Russia and Ukraine to end the war.

(Reporting by Ahmed Rasheed in Baghdad and Amina Ismail in Erbil; Editing by Peter Graff)