The last U.S. troops left Erbil Air Base on Wednesday, Sept. 30. Their departure ended the American military presence in Iraq, but it didn’t change a financial arrangement that gives Washington significant leverage over Iraqi currency. Since 2003, Iraq’s oil revenue has gone into accounts at the Federal Reserve Bank in New York. Operation Inherent Resolve has now closed in Iraq; U.S. forces will continue counterterrorism operations in Syria, and the coalition task force headquarters has moved to Jordan.
Who Holds the Leverage
Sheikh Kadhim al-Fartousi, spokesman for the Kitaib Sayid al-Shuhada paramilitary group, called the U.S. departure a victory, but said it didn’t end American influence. “The exit of the occupier does not mean only that soldiers and equipment go,” he told NPR, describing U.S. influence over Iraq’s economy and involvement in its internal affairs as forms of occupation.
The oil-revenue arrangement still gives Washington material leverage. The base article reports that Iraqi oil revenue has gone into Federal Reserve accounts since 2003, giving the United States significant influence over Iraq’s currency.
The 2024 agreement between Washington and Baghdad set the withdrawal in motion. A yearlong wind-down followed: U.S. and coalition forces left federal Iraq last October, before the final departure from Erbil. The base article says this moves the countries from a wartime coalition mission to a bilateral defense relationship.
Pentagon spokesperson Sean Parnell said the United States would continue targeted training and intelligence support for Iraqi forces. He described the next phase as supporting “a strong sovereign Iraq” and deeper “commercial, diplomatic, and security cooperation.” The U.S. military mission has ended in Iraq. Those other forms of cooperation haven’t.
Who Pays for the Security Transition
Iraq’s armed forces now carry primary responsibility for remaining security challenges, including ISIS remnants and Iran-aligned militias, Parnell said. NPR reported that U.S. support to the Iraqi military in recent years, apart from air assets, centered on intelligence and surveillance, including signals intelligence technology Iraq doesn’t possess.
Iraqi officials have voiced concern about the resources the transition requires. The Kurdistan Regional Government’s Peshmerga Ministry said the region faced more than 1,000 drone and ballistic-missile attacks during the recent U.S.-Iran conflict. It warned that the U.S. departure “without the provision of a defense system, is a matter of concern.” Sabah al-Numan, spokesman for the chief of the Iraqi armed forces, said Iraq was discussing purchases of air defense systems from South Korea, Turkey and the United States.
The withdrawal hasn’t settled the government’s effort to disarm non-state armed groups. A handful of less influential militias agreed to hand over weapons, while powerful groups close to Iran rejected disarmament or set conditions the government was unlikely to meet. Al-Zaidi told The New York Times that the deadline had been pushed to June 2027. Three of the most powerful Iran-backed militias said they wouldn’t surrender weapons while Iraq remained vulnerable.
The Islamic Resistance in Iraq said its talks with the government had produced no agreement and that it was “not bound by any timeline or agreement” announced by the government or a political entity. Kataib Hezbollah leader Ahmad al-Hamidawi urged fighters to stop military activity, except when targeting hostile aircraft violating Iraqi airspace.
A Handover, Not an End to Conflict
At a handover ceremony in Baghdad, Prime Minister Ali al-Zaidi described a “new phase” defined by Iraqi sovereignty and “balanced partnerships with its friends.” The event took place at the former joint military command center across from the American Embassy and was closed to the press, NPR reported. Baghdad declared a two-day holiday and called Wednesday “sovereignty day.”
“We are moving from working under the umbrella of the coalition to an equal relationship with them,” said al-Numan. “But at the end they have to go.” He said Iraq was exploring bilateral military agreements with the United States.
ISIS remains active in Iraq and Syria as scattered sleeper cells. Iraqi special forces said they killed two suicide bombers in Alton Kupri, near Kirkuk, on the Sunday before the report; they said a civilian also died. Al-Numan said Iraq had formed two joint Iraqi-Kurdish brigades for counter-ISIS operations.
The withdrawal ends a U.S. military involvement that began with the 2003 invasion. Reports differ on the war’s human cost: The Hill cited more than 4,500 U.S. service members killed and between 186,000 and 210,000 Iraqi civilian deaths, while NPR reported more than 4,400 U.S. military personnel killed and at least 200,000 Iraqi civilian deaths.
The economic aftermath shows up in a different measure. Baghdad and most other cities are generally calm, but apartment complexes, malls and restaurants under construction are unaffordable for many Iraqis, the base article reported. The troops have left. The oil revenue still goes into Federal Reserve accounts in New York.