US Continues to Control Iraq's Oil Revenues

The US has maintained control over Iraq's oil revenues since its invasion in 2003, giving Washington significant leverage over Baghdad's affairs. The arrangement, which involves the Federal Reserve Bank of New York managing Iraq's oil income, has been renewed by every US president since George W. Bush.

This setup was established through the Development Fund for Iraq (DFI), held at the New York Fed, and designed to collect oil revenues for reconstruction and development efforts. The DFI also aimed to protect Iraqi oil revenues from lawsuits related to Saddam Hussein's rule.

The US has used this control to exert pressure on Iraq, as seen in 2020 when Baghdad asked US troops to leave but ultimately backed down after Washington reportedly threatened to cut its access to New York Federal Reserve funds.