Iran will resume normal gas flows to Iraq on Wednesday after reaching an agreement with Iraq on Tuesday over unpaid bills, a spokesman for Iraq's electricity ministry said.
Iran's state gas company said on Monday it had slashed supplies to neighbouring Iraq over arrears of more than $6 billion. The Iraqi electricity ministry said the cuts placed Baghdad and other cities at risk of serious power shortages.
An agreement was reached during a meeting between Iranian Energy Minister Reza Ardakanian, who is visiting Baghdad, and Iraqi counterpart Majid Mahdi to resume normal gas flow rates as of Wednesday evening, spokesman Ahmed Moussa told Reuters.
Ardakanian said he has reached an agreement with the Iraqi government authorities on how Iranian funds blocked in a commercial bank in the Arab country could be used by Tehran for purchase of COVID-19 vaccines from a European manufacturer.
Ardakanian said that Iraqi authorities had also agreed to pay overdue debts to the National Iranian Gas Company and Iran’s state electricity company Tavanir.
Iran's electricity minister also met with Prime Minister Mustafa al-Kadhimi and conveyed the Iranian government's pledge to "urgently resume gas pumping which had been slashed recently after technical problems", a statement from the prime minister's office cited Iran's minister as saying without giving details.
Iran has been unable to access billions of dollars in assets in several countries due to US sanctions.