By Dr. Pshtiwan Faraj 

Iraq and the United States; The new energy map is being drawn with $60 billion contracts

On Friday evening, Western energy companies signed several agreements with Iraqi officials in the fields of oil, gas and pipelines. Iraq, as a member of the Organization of Petroleum Exporting Countries (OPEC), is trying to deepen ties with the United States and find alternatives to the Strait of Hormuz to export its energy resources to world markets.

Iraqi Prime Minister Ali al-Zaidi said through an interpreter during a US-Iraq trade summit hosted by the US Chamber of Commerce that his government would pursue an "open door" policy. The remarks came during an event in which Iraqi officials and US companies signed several informal agreements and memoranda of understanding worth more than $60 billion in the energy, health care and technology sectors.

"Any party that has a project can come and talk to us," Zaidi said, according to Reuters. We will not make things difficult for anyone.

Meanwhile, the US-Israeli war against Iran has cast a shadow over the Middle East.

US President Donald Trump's envoy to the region, Tom Barack, said the war had caused chaos but had put Iraq at the forefront of a new strategic security alliance with the United States and other countries.

On Thursday, Zaidi visited Chevron's headquarters in Houston before Iraqi officials signed an agreement with the oil giant to continue the company's plans for appropriate access to the West Qurna 2 and Nasiriyah oil fields.

Jake Spearing, head of institutional business development at Chevron, said during the event that the company is investing in a pipeline that will allow passage through the Strait of Hormuz without crossing, opening up an alternative route for Iraqi oil exports. He said the pipeline is likely to transport Iraqi oil to Syria's western coast overlooking the Mediterranean.

Iraqi oil exports have been hit by the war, partly due to the closure of the Strait of Hormuz, through which about 20 percent of global oil and gas supplies normally pass.

Spearing said the huge potential of Iraq's energy sector could make Iraq a regional hub in the Middle East on par with well-known US energy trading hubs; such as the Henry Hub natural gas plant and the Cushing oil plant.

ConocoPhillips has announced that it has agreed to buy a 42 percent stake in BP Energy Kirkuk, joining British oil giant BP in the development of four productive oil fields in northern Iraq.

BP CEO Mig O'Neill said Iraq has "tremendous potential" in terms of resources, adding that these partnerships contribute to strengthening Iraq's and the world's energy security.

The company has a long history in Iraq; In 1927, he participated in the discovery of the Kirkuk field.

Ryan Lance, CEO of ConocoPhillips, said his company does not have the same history as BP in Iraq, but has extensive experience working in harsh environments; Like the North Slope area of ​​Alaska.

"We look forward to bringing our technology, expertise, cadres and capital to participate in supporting the Iraqi people," Lance said.

During his five-day visit to the United States, Zaidi met with US President Donald Trump at the White House on Tuesday. Trump said the United States will sign several agreements with Iraq to help create jobs in both countries.

From Oil and Gas to AI and Digital Infrastructure, Baghdad and Washington Are Building a New Era of Strategic Economic Cooperation

Iraq and the United States have unveiled nearly $60 billion in energy, infrastructure, and technology agreements, signaling a strategic shift in Baghdad's economic priorities and regional partnerships.

Iraq and the United States Are Quietly Reshaping the Middle East's Energy Order

While global attention remains focused on wars in Ukraine and Gaza, another geopolitical transformation is unfolding—one that could have lasting consequences for Iraq, the Gulf, and the wider Middle East.

During Iraqi Prime Minister Ali al-Zaidi's visit to Washington, Baghdad and the United States signed a package of agreements and memoranda of understanding worth approximately $60 billion, spanning energy, electricity, digital infrastructure, telecommunications, artificial intelligence, finance, and transport.

Although the headlines have focused on the impressive investment figure, the real significance lies elsewhere.

These agreements represent a strategic attempt to redefine Iraq's economic future and reposition the country as a bridge between regional powers and global investors. They also suggest that Washington's engagement with Iraq is increasingly shifting from military cooperation to long-term economic statecraft.

If implemented successfully, the agreements could become one of the most consequential investment packages in Iraq since 2003.

Beyond Oil: A Broader Strategic Partnership

For decades, Iraq–U.S. relations were dominated by security, counterterrorism, and military cooperation.

Today, the relationship is evolving.

Instead of tanks and troop deployments, discussions increasingly revolve around:

• Energy infrastructure.
• Electricity generation.
• Natural gas development.
• Artificial intelligence.
• Satellite communications.
• Digital transformation.
• Financial modernization.
• Private-sector investment.

This reflects a broader U.S. strategy of competing through economic partnerships rather than security commitments alone.

For Iraq, it offers an opportunity to modernize an economy still heavily dependent on crude oil exports.

Why $60 Billion Matters

A package of this size is not simply about investment.

It signals confidence.

Large international companies commit capital only when they believe political conditions, regulatory frameworks, and long-term demand justify the risk.

If even a substantial portion of these projects moves forward, Iraq could witness:

• Expansion of electricity production.
• Increased natural gas processing.
• Reduced gas flaring.
• Modernized digital infrastructure.
• Higher foreign direct investment.
• Thousands of skilled jobs.
• Greater private-sector growth.

For a country seeking to diversify beyond oil, these investments could become a catalyst for structural economic reform.

Energy Security at the Center

The energy sector remains the cornerstone of Iraq's economy.

Despite possessing some of the world's largest oil and gas reserves, Iraq continues to face electricity shortages and relies on imported gas to meet domestic demand.

The new agreements are expected to support:

• Development of natural gas fields.
• Expansion of electricity infrastructure.
• Improved energy efficiency.
• Greater integration of renewable and advanced energy technologies.
• Reduced dependence on imported fuel.

Achieving these objectives would strengthen Iraq's energy sovereignty and improve long-term economic resilience.

The Geopolitical Implications

1. Iraq Is Diversifying Its Strategic Partnerships

Rather than aligning exclusively with one international power, Baghdad appears to be pursuing a multi-vector foreign policy.

Iraq now engages simultaneously with:

• The United States.
• China.
• Gulf Cooperation Council (GCC) states.
• European investors.
• Türkiye.

This diversification allows Iraq to attract investment while avoiding excessive dependence on any single partner.

2. Economic Diplomacy Is Replacing Military Diplomacy

For years, U.S.–Iraq relations were defined by security cooperation.

The latest agreements indicate a gradual transition toward economic diplomacy.

Washington increasingly views infrastructure, technology, and private investment as tools for strengthening bilateral relations and maintaining influence in the Middle East.

This mirrors broader global competition, where economic connectivity often matters as much as military alliances.

3. Competition with China

The agreements also carry significance in the context of U.S.–China competition.

China has become one of Iraq's largest trading partners and a major investor in infrastructure and energy through the Belt and Road Initiative.

By securing major American investments, Baghdad demonstrates that it is not choosing one partner over another but instead seeking to maximize opportunities from multiple global powers.

This balancing strategy may enhance Iraq's geopolitical flexibility.

4. Energy Is Becoming a Strategic Weapon

Energy infrastructure is increasingly viewed as an instrument of geopolitical influence.

Countries that control production, transport routes, refining capacity, and digital energy systems gain significant strategic advantages.

The U.S.–Iraq agreements therefore strengthen Iraq's position within regional energy networks while supporting efforts to become a more reliable supplier and investment destination.

What This Means for the Kurdistan Region

Although many agreements focus on federal Iraq, the Kurdistan Region could benefit indirectly.

A stronger Iraqi energy sector may create opportunities for:

• Improved electricity integration.
• Greater investment confidence.
• Expanded gas infrastructure.
• Technology transfers.
• Increased demand for regional expertise.

If Baghdad and Erbil maintain constructive cooperation on energy policy, both governments could benefit from stronger international investor confidence.

Challenges Ahead

The announcement of large investment packages is only the beginning.

Success will depend on:

• Political stability.
• Regulatory reform.
• Security conditions.
• Transparent procurement.
• Efficient project implementation.
• Coordination between federal and regional authorities.

Iraq has announced ambitious investment initiatives before, but implementation has often lagged behind expectations. Turning memoranda of understanding into completed projects will be the true test of this partnership.

A New Chapter in Iraq's Economic Story

The $60 billion agreements suggest that Iraq is attempting to reposition itself as more than an oil exporter.

By investing in energy, digital infrastructure, artificial intelligence, and advanced telecommunications, Baghdad is laying the foundations for a more diversified economy.

Whether these ambitions are fully realized will depend on sustained political commitment and institutional reform, but the direction is clear: Iraq is seeking to become a regional hub for energy, technology, and investment.

Conclusion

The latest U.S.–Iraq agreements are not simply a collection of commercial contracts—they represent a strategic blueprint for Iraq's future. If implemented, they could reshape the country's energy landscape, accelerate digital transformation, strengthen economic resilience, and deepen ties with one of the world's leading technology and investment partners.

For Washington, the agreements reinforce a strategy of maintaining influence through economic engagement rather than military presence alone. For Baghdad, they provide an opportunity to modernize critical infrastructure, attract global capital, and diversify an economy long dependent on oil revenues.

The real measure of success, however, will not be the headline figure of $60 billion, but whether these commitments are translated into power plants, gas projects, digital networks, jobs, and sustained economic growth. If they are, historians may look back on this moment as the beginning of a new energy map for Iraq—and perhaps for the wider Middle East.

Strategic Implications

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