US halts shipment of Iraq’s oil dollars in bid to curb Iran-linked groups

Lead

The United States has halted shipments of US dollars to Iraq and paused some security cooperation programs with the Iraqi military, increasing pressure on Baghdad to curb powerful Iran-aligned groups, according to Iraqi and US officials cited by The Wall Street Journal and reported by multiple news outlets.

A recent cargo plane shipment carrying nearly $500 million in US banknotes was blocked by the US Department of the Treasury, as reported by Al Jazeera, France 24, and the Jerusalem Post. The money came from Iraqi oil revenues held in accounts at the Federal Reserve Bank of New York. The suspended transfer was the second scheduled dollar shipment to Iraq's central bank delayed by Washington since the US-Israel war on Iran began in late February, according to The Wall Street Journal as cited by Al Jazeera and France 24.

Coverage Comparison

The story was first reported by The Wall Street Journal on April 22, 2026, and was subsequently covered by Al Jazeera, Fox News, France 24, the Jerusalem Post, and TASS. All sources agree on the core facts: the US blocked a dollar shipment, froze some military cooperation, and is demanding Iraq take action against Iran-aligned militias. However, there are differences in framing and additional details.

Fox News and the Jerusalem Post emphasized the Trump administration's punitive measures, with Fox News stating that the administration "tightened the screws" on Iraq and quoting a State Department spokesperson who called Iran-aligned militias "terrorist militias." France 24 provided context on the history of Iraqi oil revenues being held at the Federal Reserve since 2003, while TASS noted that a similar suspension occurred in 2015 due to concerns about funds reaching the Islamic State.

Key Claims

• The US blocked a delivery of nearly $500 million in US banknotes from the Federal Reserve Bank of New York, funds derived from Iraqi oil sales, as reported by Al Jazeera, France 24, the Jerusalem Post, and TASS.
• The US has frozen funding for some military training and counterterrorism programs for Iraq, as reported by Fox News, the Jerusalem Post, and TASS.
• The suspended transfer was the second such delay since the US-Israel war on Iran began, according to The Wall Street Journal as cited by Al Jazeera and France 24.
• The US has carried out air attacks against Iran-aligned armed factions in Iraq, including groups linked to the Popular Mobilisation Forces, as reported by Al Jazeera and France 24.
• The US Department of Justice announced a $10 million bounty for information on Ahmad al-Hamidawi, leader of the pro-Iranian militia Harakat Ansar Allah al-Awfiya, as reported by Fox News. This claim was not mentioned in other sources reviewed.
• The US has designated seven Iran-backed Iraqi militia commanders as terrorists, according to the Jerusalem Post. This claim was not mentioned in other sources reviewed.

Perspectives

The US administration, as reflected in a State Department statement reported by Fox News, asserts that it will take all measures to counter Iran's destabilizing activities and protect US interests against "Iran-aligned terrorist militias." The US demands that Iraq dismantle these groups, which it says are attacking US facilities and personnel.

Iraq's central bank, in a statement on Tuesday, did not directly refer to the halted deliveries but said it had sufficient US currency reserves, as reported by Al Jazeera.

Analysts quoted by France 24 noted that Iraq has not had full control over its oil revenues since the 2003 US invasion, as funds are held in New York to protect them from creditors. Adel Bakawan, director of the European Institute for Studies on the Middle East and North Africa, explained that this system was put in place after the invasion when Iraq was burdened with massive debts.

Some sources, including TASS, noted that the US actions are intended to weaken Iraq's ties with Iran and increase pressure on Baghdad, a perspective consistent across most outlets.

It is important to note that while the US has designated some groups as "terrorist," other sources use more neutral terms such as "Iran-aligned groups" or "armed factions." The language used by Fox News and the Jerusalem Post reflects a more critical stance toward Iran, while other outlets maintain a more neutral tone.

Reuters, as reported by the Jerusalem Post, said it could not immediately verify the Wall Street Journal report, and the US Treasury Department and Federal Reserve did not respond to requests for comment.