According to a Reuters analysis, the United States may take steps similar to the pressure mechanism it used in Iraq to exclude countries trading with Iran from the dollar-based financial system. This policy could make Türkiye, China, the United Arab Emirates, India, Pakistan and Oman targets. However, the White House has not yet named any countries or taken any concrete steps.
The United States has had an effective control mechanism over Iraq’s oil revenues since 2003. While Iraq’s reserves of more than $100 billion are held in the United States, Washington halted a $500 million cash shipment to be sent to the country in April. Despite this, trade between Iraq and Iran exceeded $10 billion in 2025.
Iraq pays $4 to $5 billion annually for Iranian natural gas used in electricity generation. Iraqi officials said new US measures could put these payments at risk. US Treasury Secretary Scott Bessent, meanwhile, said countries that fail to comply with sanctions would be isolated like Iran.
Why it matters
Such an approach turns trade with Iran from an issue of bilateral relations into a problem of access to the dollar-based financial system. For the countries mentioned, including Türkiye, the issue is how to strike a balance between maintaining trade with Iran and the risk of being exposed to US financial pressure. The fact that Iraq’s reserves are held in the United States and that it is dependent on Iranian natural gas for electricity generation shows that this pressure could affect public finances and energy supply simultaneously. Nevertheless, the continuation of high trade volumes despite existing controls demonstrates that sanctions tools have not completely severed commercial ties. The fact that the White House has not yet announced either the names of countries or concrete measures leaves open the scope and timing of implementation, as well as how the target countries will be selected.