British newspaper: Tom Barrack arrived in Baghdad with the keys to the Federal Reserve sanctions threat.
British newspaper: Tom Barrack arrived in Baghdad with the keys to the Federal Reserve sanctions threat.
6-28-2026
The Middle East Monitor, a British newspaper, reported on Sunday that when Trump announced the appointment of Tom Barrack as the special presidential envoy to Iraq, he arrived with a barrage of economic threats against Baghdad.
The report, translated by Al-Maalomah News Agency, stated that “Barrack did not arrive in the Iraqi capital with a briefing and a handshake, but rather with a threat and a key to a vault—and this vault is Baghdad’s lifeline.”
The report explained that “since 2003, Iraq’s oil revenues have been deposited in a dedicated account at the Federal Reserve Bank of New York. When Baghdad needs hard currency, the US Treasury arranges for the transfer of dollar bills—sometimes reaching $13 billion in a single year—on cargo planes from New Jersey to the Central Bank of Iraq. This arrangement, born out of post-invasion necessity and designed to protect the new Iraqi government from Saddam Hussein’s creditors and compensation claims, has since transformed into something else entirely: a key to Iraq’s political economy, managed from Lower Manhattan, and at the forefront of American threats against Iraq.”
The Trump administration demonstrated the extent of this control. Last April, the US Treasury Department blocked the transfer of nearly $500 million in Iraqi oil revenues and simultaneously suspended security cooperation programs with the Iraqi army. A senior Kurdish official, speaking to Fox News, offered the most candid assessment in months, stating, “Freezing the dollar is the nuclear option in the Treasury’s arsenal, and the Americans have always been hesitant to use it.” Barrack’s appointment signals the end of that hesitation.
The report noted that “Tom Barrack is not a career diplomat—and this is likely the intention—but rather a private investment businessman who, in a moment of indiscretion, described Iraq as a ‘failed political experiment’ and Lebanon as a ‘farce.’ If these statements are translated into policy, they are not insults but rather diagnostic indicators: Washington no longer views Iraq as a political partner in negotiations but as a dysfunctional security file in need of restructuring, and its preferred tool—one it has mastered perfectly—is pressure exerted through the Federal Reserve.”
The report further indicated that “this pressure is immense, as oil export revenues fund an estimated 90 percent of the government’s budget.” The Iraqi situation will not only cause a prolonged dollar shortage that inconveniences Baghdad ministries, but will also exacerbate inflation, destabilize the Iraqi dinar, and drain the salaries of state employees.
almaalomah.me
