US Keeps Grip on Iraq's Oil Revenue Dollars

The US has maintained control over Iraq's oil revenue dollars since its 2003 invasion of the country. The arrangement, which allows Iraq to collect and manage its oil income through the Federal Reserve Bank of New York, gives Washington significant leverage over Baghdad's affairs.

Oil is Iraq's most important revenue source, making up about 90% of the state budget. This control has implications for regional dynamics involving Iran, with whom Iraq has a deep influence.

The system was set up by the Coalition Provisional Authority (CPA), led by the US, and was designed to collect oil revenues for use in reconstruction and development efforts. It also aimed to protect Iraqi oil revenues from lawsuits related to Saddam Hussein's rule.