The United States has started flying pallets of physical US dollars back into Iraq after a suspension that lasted roughly nine days. The first post-pause shipment arrived by aircraft on May 1, 2026, confirmed by Iraqi Prime Minister’s economic advisor Mazhar Mohammed Salih.
The cash freeze, which began on April 22, blocked an estimated $500 million in physical dollar deliveries. It was Washington’s way of turning the economic screws on Baghdad over the continued presence and influence of Iran-backed militias operating inside Iraq.
What actually got suspended, and what didn’t
Iraq’s dollar dependency operates on two tracks. There’s the electronic pipeline, which handles international trade and large-scale imports. That kept flowing the entire time. Then there’s the physical cash track, actual banknotes flown in on planes, which covers retail needs across the Iraqi economy. It was only the second track that got shut off.
The suspension was partly attributed to airspace closures connected to a late-February 2026 US-Israel conflict with Iran. But the geopolitical subtext was louder than the logistical excuse. The Trump administration has been escalating pressure on Iraq’s government to crack down on Iranian proxy forces, particularly after attacks targeting US personnel in the region.
