The United States announced on Tuesday that it was renewing for 120 days a sanctions waiver allowing Iraq to buy electricity from Iran, US media reported.
"This action will allow Iraq to use its own funds to render payment for Iranian electricity imports into restricted Iranian accounts in Iraq," a senior US State Department official told journalists, pointing out that Iran can only use these funds for humanitarian needs.
Because of US sanctions against Iran, Baghdad cannot pay Tehran directly for its gas.
Baghdad's unpaid bills to Tehran for past gas imports amount to some $10 billion, according to the senior official.