Despite significant progress, Iraq still has a long way to go to meet the Trump administration’s expectations for reining in Iranian influence.

President Donald Trump is bullish on Iraq and its new prime minister, Ali al-Zaidi, whom Trump will host for an Oval Office meeting this week. Trump has declared that al-Zaidi’s appointment represents “the beginning of a tremendous new chapter between our nations.” Since the 2003 US-led invasion that toppled Saddam Hussein’s dictatorship, Washington and Baghdad have had a complicated relationship. Al-Zaidi’s first few weeks have shown promise. Still, undue Iranian influence in Iraq remains an impediment to improved US-Iraqi ties—one that will be difficult for the new prime minister to overcome.

Trump’s team has high expectations for al-Zaidi’s Iraq. The Trump administration’s top priority is the disarmament and disbandment of the grouping of Iranian-backed militias known as the Popular Mobilization Forces (PMF). These US-designated terrorist organizations—including Kataib Hezbollah, Harakat Hezbollah al-Nujaba, Asaib Ahl al-Haq, and a few others—are funded by the Iraqi government but answerable to Tehran. For nearly a decade, the groups have targeted US diplomatic and military personnel, assets, and allies throughout the region. In 2021, one of these militias tried to assassinate then-Iraqi Prime Minister Mustafa al-Kadhimi after he took steps to constrain them. 

The United States has other objectives in Iraq, including deepening the trade and investment relationship (and securing contracts for American firms in Iraq) and ending Baghdad’s dependence on Iranian energy. The Trump administration is also reportedly pressuring Iraq to cooperate with Syria and Jordan on new oil pipeline projects to the Mediterranean to reduce reliance on the Strait of Hormuz. To round out the US to-do list, Trump’s team is hoping to lock in al-Zaidi’s Iraq as a reliable counterterrorism partner.

Al-Zaidi’s agenda for Iraq has a lot of overlap with Trump’s. Still, the new Iraqi leader may well not succeed. Al-Zaidi is a political novice—the premiership is his first government job—and he faces significant opposition not only from Iraqis ideologically aligned with Iran but also from officials profiting from the state’s endemic Iran-friendly corruption. As a former businessman, al-Zaidi likely understands that US investment is largely contingent on the Iraqi security environment. But absent progress on disarming militias—and rolling back Iran’s preponderant influence in Iraq—closer ties with the US are unlikely.

Still, al-Zaidi is off to a quick start. Just shy of two months in office, his government has already signed contracts with several American energy companies, including Chevron, Halliburton, and KBR, as well as an agreement with Starlink to provide high-speed internet services throughout the country. No doubt, these deals will be well received by the Trump administration, but they will also benefit Iraq.

Even before Trump’s Iran War, Iraq was facing staggering deficits. To balance the budget, Baghdad is concentrating on increasing hydrocarbon production, which now accounts for about 90 percent of state revenues. Accordingly, the contracts focus on increasing oil output in the coming years from 5 to 7 million bpd and on enabling the capture of gas generated during oil production, which is currently flared. Gas capture would ease Iraqi dependence on Iranian gas imports.

Al-Zaidi also hit the ground running on fighting corruption. In late June, he launched an extensive campaign of arrests for graft, tasking the state’s Counter Terrorism Service (CTS) to detain nearly 50 government officials and legislators. High-profile apprehensions during “Operation Dawn” included two deputy oil ministers, government electricity officials, and several Iraqi members of parliament. More than $100 million in cash and assets were seized. The crackdown has its domestic critics—especially politicians—but the operation earned al-Zaidi high praise in the West. The question is whether al-Zaidi will persist in his anti-corruption campaign to implicate members of the Iran-allied Shia Coordination Framework governing coalition that effectively installed him as premier.

Contending with the Iran-backed militias in the PMF will prove the premier’s biggest challenge. Backing for these groups in Iraq is generally low, given their role in the October 2019 massacre of protestors and, more recently, the missile and drone barrages they have launched at Iraq’s Kurds. Yet these Iran-supported factions maintain a small but ardent core of support within the Shia community. The large turnout of Shia in Najaf and Karbala for the funeral procession last week of longtime Supreme Leader Ali Khamenei—many of them carrying signs calling for Trump’s execution—suggests that Iran has an enduring constituency in Iraq.

Even so, al-Zaidi appears to be making some modest headway on disarmament. In June, after extensive consultations with his administration and the Supreme Judicial Council chief, two militias issued statements indicating that they might be willing to turn over their arms to the Iraqi state. It’s unclear whether the gesture is a real, irreversible step or merely an attempt to provide the weapons to the PMF for safekeeping. Skeptics of the initiative believe it’s a Trojan Horse tactic that would superficially cleanse these groups’ terrorist past, allowing them to embed themselves in the government more deeply. And at least three other US-designated Iraqi factions—including the most active and dangerous groups—refuse to discuss demobilization. 

So this week’s White House meeting is an opportunity for al-Zaidi to review his agenda and for Trump to articulate what he envisions as the “new chapter” in US-Iraq relations. Iraq is not going to break with Iran anytime soon. Still, the administration seems to be trying to loosen Tehran’s chokehold by deepening ties with US industry, reducing Iraq’s reliance on Iranian energy, and better connecting Baghdad to its Arab neighbors through oil pipelines. If the plan is to use diminished Iranian dominion over Iraq to facilitate progress on the PMF factions, it’s a good one. 

Disarming the PMF will take time and resolve. To encourage Baghdad, the Trump administration has lifted energy waivers that allowed Iraq to purchase Iranian energy. And earlier this year, Washington briefly froze the cash transfers of US dollars from the Federal Reserve Bank of New York to Iraq. The curtailment forced al-Zaidi to adopt stricter measures to prevent smuggling of these dollars to Iran. Going forward, the US Treasury dollars will provide the administration with useful leverage to keep al-Zaidi focused on the Iran-backed militias.

So far, Trump has been enthusiastic about al-Zaidi. Based on the prime minister’s performance so far, the Trump administration is right to be reasonably optimistic. But other seemingly promising Iraqi premiers—like Mustafa al-Kadhimi (2020–26) and Mohammed Shia al-Sudani (2022–26)—failed to limit Iranian influence or, worse, ended up empowering terrorist factions of the PMF. For Iraq to succeed and for the US-Iraq relationship to improve, Washington should curb its exuberance and commit to sustained and intensive engagement with Baghdad. It’s going to be a long, hard slog.

About the Author: David Schenker

David Schenker is the Taube senior fellow at The Washington Institute and director of the Linda and Tony Rubin Program on Arab Politics. Confirmed by the Senate on June 5, 2019, he served as assistant secretary of state for Near Eastern Affairs through January 2021. In that capacity, he was the principal Middle East advisor to the secretary of state and the senior official overseeing the conduct of US policy and diplomacy in a region stretching from Morocco to Iran to Yemen, with responsibility for 18 countries, the Palestinian Authority, and Western Sahara.

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