The report cited an Iraqi Kurdish official who attributed the measures as a response to the smuggling of US dollars by Iran-backed Iraqi militias.

The US resumed physical dollar air shipments to Iraq on May 1 after a nine-day suspension that blocked roughly $500 million amid Iran-related tensions.

The US resumed physical dollar shipments to Iraq in early May 2026 after blocking nearly $500M in banknotes over concerns about Iranian-backed militias.