It looks like Iraq is moving ahead with a deal to import natural gas and electricity from Turkmenistan despite warnings from the United States that it would violate sanctions on Iran.
On October 21 Iraq and Turkmenistan signed another memorandum of understanding on energy and gas imports. Iraq wants to buy 14-15 million cubic meters a day of natural gas and 2000 megawatts of electricity from the Central Asian country. The natural gas would be used to fuel Iraq’s power stations and help relieve the dependency upon Iranian gas which has proven unreliable over the years. Baghdad is also under pressure from the United States to stop buying from Iran. The Iraq and Turkmenistan have been talking about this deal since 2023.
Two years ago Iraq and Turkmenistan signed the original preliminary deal to buy natural gas. There is no connection between the two countries however so there was talk of using pipelines in Turkey to deliver the gas. Things quickly changed to using Iran’s infrastructure.
In 2024 a contract was signed to try to finalize things. A Swiss company Luxton Energy would be the middleman in charge of delivering the gas and Iranian pipelines would be used.
This immediately raised concerns. Two experts were quoted in Al Aalem saying that costs would be too high because Iraq would not only have to pay Luxton Energy but transit fees to Iran. The Iraq Energy Center stated that Iran could take up to 30% of the natural gas as payment. Not only that but Turkmenistan is supposed to be an alternative to Iranian gas but using its pipelines means Tehran is still in control of this deal.
Another issue has been the long delays. After the 2024 contract was signed nothing happened. The Electricity ministry said talks were still underway and the Trade Bank of Iraq hadn’t finalized the financing. Iraq’s bureaucracy is infamously slow and this is very common.
Then in September 2025 it was revealed that the United States didn’t approve of the deal because it would violate sanctions on Iran. It now appears Baghdad is willing to risk the consequences and is trying to finalize things with Turkmenistan.
The Trump administration is constantly telling Iraq it needs to cut its ties with Tehran. This is part of the president’s renewed Maximum Pressure Campaign against Iran. Being neighbors the two countries are intimately connected and much of the Iraqi elite are not only friendly with Tehran but paid by them as well. That has constantly put it in a difficult balancing act telling Washington it is doing what it can to move away from Iran while making it more reliant upon Tehran with deals like this one.
SOURCES
Al Aalem, “Turkmen gas via Iranian pipelines … will it meet electricity needs?” 10/20/24
- “Turkmenistan gas contract .. has not entered into force and the reason is “mysterious banking,”” 12/28/24
- “Turkmenistan gas competes with Iranian gas in Iraq .. Its production is more important than imports,” 8/25/23
- “Turkmenistan Gas is out of effect for mysterious banking reasons .. What is Iran’s connection?” 12/29/24
- “Turkmenistan Minister of State arrives in Baghdad .. and selling natural gas tops his agenda,” 10/19/24
Agence France Presse, “Iraq, Turkmenistan sign ‘preliminary’ gas deal,” 10/6/23
Lucente, Adam, “Iraq to receive gas from Turkmenistan,” Al Monitor, 8/24/23
Al Mada, “Iraq discusses Turkmen gas with Washington and prepares an alternative plan to secure fuel,” 10/8/25
Al Rafidain, "Iraq Energy Center: Iraqi to deduct 30% of Turkmen gas for its own benefit as transit fees,” 1/19/25
Reuters, “Iraq fails to win US approval to import Turkmen gas via Iran,” 9/19/25
Salem, Amr, “Iraq seeks to accelerate gas supplies from Turkmenistan,” Iraqi News, 5/25/25
- “Iraq-Turkmenistan gas deal awaits US Treasury approval,” Iraqi News, 6/12/25
- “Iraq, Turkmenistan sign gas supply agreement,” Iraqi News, 10/21/25
Al-Samarraie, Jawad, “Iraq finalizes deal to import Turkmenistan gas, boosting power generation by 2000MW,” Iraq News, 7/10/25
Shafaq News, “Iraqi Ministry of Electricity refutes claims about Turkmenistan gas agreement,” 12/29/24
Xinhua, “Iraq signs deal with Turkmenistan to import gas for power plants,” 10/19/24
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