AGP Executive Report

US-Kuwait Footprint Review: The Pentagon is weighing a smaller US presence in Kuwait after Iran-linked missile and drone attacks made the deployment look like a liability, even as Kuwait still sees it as necessary for defense. Air-Defense Push in Iraq: After US-Saudi strikes on Iran-backed militias, Baghdad says modernizing air defenses is a top priority—an effort it has promised before. Regional Escalation Risk: Iraqi and Saudi analysts warn the conflict could pull Iraq into a wider regional war as Baghdad struggles to control weapons outside state institutions. Iraq Orders Readiness Boost: Iraq raised alert levels across air defenses and intelligence after the strikes, with plans for radar and early-warning upgrades. Oil and Exports: Iraq’s Oil Minister heads to Türkiye to finalize expanded crude export routes via the Iraq-Türkiye pipeline to Ceyhan, aiming to reduce reliance on traditional transit amid Hormuz disruptions. Arbaeen Under Tension: Iranian pilgrims are flooding into Iraq for Arbaeen as fresh strikes keep the region on edge. Christian Return Plan: Iraq’s bishops will assess a government scheme to encourage Christian families to return, including support tied to housing land projects. Baghdad Housing Strain: Many newlyweds in Baghdad are moving in with relatives as rents climb beyond reach.

U.S.-Saudi-Iran Tensions: Iraq is facing fresh escalation after US-Saudi strikes hit Iran-backed armed groups in Iraq, with Baghdad ordering probes, raising nationwide military alert, and rejecting claims of “approval” or “prior knowledge,” while Saudi officials insist the targets were militias—not the Iraqi state—sparking warnings from Syria that strikes from Iraqi soil could trigger Syrian retaliation. Regional Diplomacy: Turkish FM Hakan Fidan held talks with Saudi counterparts as the Iran war widens, while President Barzani met Taqaddum leader Mohammed al-Halbousi to discuss Erbil-Baghdad coordination. Security & State Authority: Reports say Prime Minister Ali al-Zaidi threatened to resign over militia disarmament delays, as Iraq pushes a new security strategy to stop weapons outside state control. Economy Under Pressure: Iraq’s oil-driven budget strain is worsening, with officials warning salary and healthcare financing gaps. Arbaeen Logistics: Iraq expects around 22 million pilgrims for Arbaeen, with major transport and security preparations underway, including heavy activity at Najaf International Airport.

Kurdistan Reconciliation & Justice: KRI President Nechirvan Barzani marked the 43rd anniversary of the Anfal campaign by urging Baghdad to compensate Barzani Anfal victims, calling it a “moral and legal duty.” Displacement & Return: In Duhok’s border villages, 50–60 families have returned to Kashani after a ceasefire between Türkiye and the PKK, while nearby communities remain empty pending security approvals. Iraq’s Sovereignty Clash: Iraq’s government again denied it approved or had prior knowledge of US-Saudi strikes on PMF positions, and said Prime Minister Ali al-Zaidi’s Saudi visit was suspended after the attacks. Regional War Escalation: The US and Saudi carried out joint airstrikes in Iraq after Iran launched ballistic missiles at a US base in Jordan; Iran also repatriated five IRGC members killed in Iraq strikes. Diplomacy & Economy: Kazakhstan and Iraq discussed closer cooperation on water resources and a possible memorandum of understanding. Arbaeen Logistics: Iran-linked reporting said the killed IRGC members were tasked with securing Arbaeen pilgrimage routes into Iraq.

US-Saudi strikes on Iraq: Iraq’s cabinet spokesperson Haider al-Aboudi says Baghdad had “no prior knowledge” and did not approve the US-Saudi airstrikes that hit Iran-aligned PMF sites, after Trump claimed coordination with Iraqi authorities; Regional escalation: the strikes followed accusations that drones hit Saudi oil facilities, with Saudi and CENTCOM blaming IRGC-directed networks while Iraqi factions and the Houthis dispute who launched the attacks and from where; PMF and Iraqi politics: former PM Haider al-Abadi warned that forcing weapons under state control without proof and due process could spark fighting among Iraqis, calling for investigation into whether attacks originated from Iraqi territory; Economy and governance: Finance Minister Faleh Al-Sari said Iraq faces a funding gap of about $2.52B to complete salary, pension, and welfare payments, while private banks report liquidity shortages and possible consolidation; Arba’een preparations: Wasit and Kirkuk declared an official holiday ahead of Arba’een, exempting security and essential services.

US-Iran Escalation: The US says it carried out a “heavy wave” of strikes on dozens of IRGC targets in Iran after an attempted ballistic missile attack on US forces in Jordan, while Iran and regional states report new hits and interceptions, raising fears the conflict will keep widening. Iraq as a Frontline: The US and Saudi Arabia also struck Iran-aligned Popular Mobilization Forces positions across Iraq, with PMF-linked sources reporting deaths and injuries and Iraqi leaders condemning the attacks as sovereignty violations. Regional Spillover: A drone attack hit a US-owned gas storage tanker at Egypt’s Damietta port, and Iran-linked actions were reported in Kuwait, underscoring how the war is spreading beyond its main battlefields. Diplomacy Under Strain: Iraq’s political class is split between calls for restraint and demands for a firm response, while outside powers push for renewed talks amid stalled de-escalation. Arbaeen Logistics: Iraq is expanding transport and border services as pilgrims continue their march to Karbala, with routes and vehicle plans scaled up for the surge. Anti-Corruption: Baghdad issued arrest warrants in a Diwaniyah corruption case, as Iraq accelerates legal action to recover public funds and tighten accountability.

US-Saudi Strikes vs PMF: Iraq’s National Security Council condemned joint US-Saudi airstrikes on Popular Mobilisation Forces sites across seven provinces, calling them a “flagrant violation” of sovereignty and ordering the Foreign Ministry to pursue legal action under international law and the UN Charter. Baghdad Response: Prime Minister Ali al-Zaidi met PMF leaders, ordered care for the wounded and honoring families of the killed, and CF leaders discussed a “firm response” while warning Iraq should not be used to “settle scores.” Militia Pushback: Iran-aligned factions including Ashab al-Kahf and Islamic Resistance in Iraq set retaliation deadlines, while PMF commanders rejected disarmament demands with the question: “Who is going to take the weapons?” Regional Escalation: Trump said strikes were coordinated with Iraq and vowed to “beat” Iran after attacks on US forces in Jordan, as Saudi officials framed the Iraq strikes as self-defence. Domestic Pressure Points: Al-Anbar agreed with the UN to finish displacement camp closures; Najaf moved ahead with a new oil exploration well; and farmland conversion to housing is shrinking fertile agricultural land.

Emergency Security Move: Iraqi Prime Minister Ali al-Zaidi ordered an emergency meeting of the Ministerial Council for National Security after US-Saudi strikes hit Iran-linked “logistics and weapons sites” across Iraq, as Baghdad weighs next steps amid rising retaliation fears. Cross-Border Escalation: The Popular Mobilization Forces said at least 20 fighters were killed and 32 wounded in the overnight raids, while the US said it intercepted an Iranian missile barrage and warned Iran-backed groups to stop attacks. Regional Messaging: Iran’s foreign ministry condemned the strikes as an attempt to expand the war, and Jordan reported intercepting five missiles launched from Iran toward its territory. Militia Politics at Home: Muqtada al-Sadr urged Iran and Iran-aligned armed groups not to target Iraqi territory, calling for stronger state sovereignty and warning against dragging Iraq into a “pointless war.” Energy Pressure: With oil and shipping risks climbing, Saudi Arabia also affirmed its strikes were in self-defence after drones allegedly launched from Iraq targeted Saudi oil facilities. Iraq-Türkiye Deal Track: Separately, Erdoğan said Türkiye could receive up to 1 million barrels per day from Iraq under a new energy cooperation plan discussed in Ankara.

Iraq-Türkiye Energy & Security Push: Prime Minister Ali al-Zaidi wrapped up talks in Ankara with President Recep Tayyip Erdoğan, agreeing to speed up the Development Road corridor and finalize broader energy cooperation, including Iraq supplying Türkiye with 1 million barrels per day; Baghdad also moved to deepen security and defense industry coordination. Kirkuk Politics: The KDP bloc ended its boycott of the Kirkuk Provincial Council and will return to sessions, citing citizen demands and its oversight role amid Iraq’s anti-corruption push. Saudi-Iran Drone Fallout Hits Iraq’s Neighborhood: Saudi Arabia said it intercepted and destroyed drones launched from Iraqi territory targeting Eastern Province oil facilities, warning it will respond if attacks continue; Baghdad ordered investigations and reiterated it will not allow its land to be used against neighbors. Regional Escalation, US-Iran Tensions: The US said Iran launched multiple ballistic missiles at American forces; all were intercepted, while mediators try to restore a ceasefire as the Strait of Hormuz remains a flashpoint. Domestic Pressure in Baghdad: Iraq’s diesel shortage worsened, with long queues reported and emergency imports being prepared as refinery work delays and reduced deliveries bite into supply. KRI Under Strain: Iraq’s Interior Minister said the Kurdistan Region is being targeted from multiple directions and urged concrete steps to stop attacks, stressing the KRI should not become an arena for settling conflicts.

Iraq-Turkey Pivot: Prime Minister Ali al-Zaidi arrived in Ankara for talks with President Recep Tayyip Erdogan on expanding economic ties, security cooperation, and water management, with a pipeline corridor from Basra to Turkey and Syria also on the agenda. Drone Tensions in the North: Multiple explosions rocked Erbil near the US consulate after Iranian drone strikes, while separate reports said a drone hit an artillery storage facility in Sulaimani province tied to the PUK. Regional Fallout Over Saudi Claims: Saudi Arabia condemned drone attacks launched from Iraqi territory and urged Baghdad to stop its land being used for aggression, as Iraq ordered probes into the allegations and Iran-backed militias denied involvement. Anti-Corruption Push: Iraq’s Integrity Commission seized 2.5 billion dinars in Saladin and courts ordered MP Alia Nassif to compensate an Interior Ministry advisor for defamation. Daily Life Pressure: A kerosene shortage worsened in Baghdad, with longer queues as refineries struggle to meet demand. Pilgrimage Update: Arbaeen arrivals kept rising, with 2.14 million pilgrims entering Iraq since Muharram began. Ukraine-Iraq Spat: Kyiv rejected Iraq’s national security adviser claims that Ukraine was behind attacks in Iraq, calling them baseless.

Saudi-Iraq Drone Row: Saudi Arabia says it intercepted and destroyed drones launched from Iraqi territory aimed at oil facilities in the Eastern Province and Riyadh, blaming Iran-backed militias; Iraqi Response: Prime Minister Ali al-Zaidi ordered an investigation and warned Iraq will not allow its soil to be used to attack neighbors; Regional Diplomacy: Kuwait condemned the attacks as a violation of sovereignty and UN rules, reaffirming solidarity with Riyadh; Militia Denial: Iraq’s Islamic Resistance rejected the Saudi claims and warned any Saudi response would trigger retaliation; US-Iran Pause: As Washington and Tehran kept up a strike lull for a third day, Trump said there’s a “good chance” of a deal while Iran denied direct negotiations; Domestic Governance: Dhi Qar’s court sentenced a former Nasiriyah municipality official to six years for bribery, and a fire broke out at Ain Al-Asad Air Base with no casualties reported.

Lebanon-Iraq Security & Diplomacy: Lebanon’s “pilot zones” in the south began as the Lebanese army deploys in phased areas after Israeli withdrawals, testing whether the state can extend sovereignty beyond armed groups—an issue that also ties into Iraq’s push for closer regional partnership. Kurdistan Security: KRG PM Masrour Barzani said drones targeting Erbil were launched from Mosul, urging Baghdad to stop attacks as the US-led coalition prepares to leave. Kirkuk Arbaeen Logistics: Kirkuk International Airport started receiving foreign Arbaeen pilgrims for the first time, coordinating security and transport to Karbala. Fuel Rationing in Erbil: The KRG launched a trial electronic-card system for subsidized fuel, limiting “Normal” subsidized gasoline to 40 liters per vehicle daily amid shortages. US-Iran War Accounting & Ceasefire Talks: The Pentagon revised down Iran-war casualty figures and created a new “Overseas Operations” category, while mediators reported progress toward renewed negotiations as US and Iran paused attacks for a second straight day. Shipping Pressure on Iraq’s Oil: Data showed traffic through the Bab el-Mandeb and Hormuz stayed subdued as Red Sea risks rose, keeping energy routes tight for Iraq’s export revenues. Corruption Probe: Iraq seized over $125m in gold and cash in an oil corruption case.

US-Iran Pause & Iraq’s Security: The US and Iran paused attacks for a second straight day as talks over an interim Strait of Hormuz ceasefire continued, while the Pentagon kept shifting how it counts casualties—adding a new “Overseas Operations” category and restoring/adjusting figures after lawmakers questioned transparency. Casualty-Counting Fallout: The Pentagon’s Defense Casualty Analysis System now lists four deaths and 207 wounded under the new category starting July 7, after earlier drops sparked Senate Armed Services Committee demands for answers. Erbil Under Pressure: Drones were intercepted over Erbil, with explosions and smoke near the airport and US consulate area, underscoring how Iraq’s Kurdistan remains a flashpoint even amid pauses. Iraq-Lebanon Energy Talks: Iraqi PM Ali al-Zaidi met Lebanon’s PM Nawaf Salam in Baghdad on energy, security, and possible new oil pipeline links to the Mediterranean as Beirut seeks steadier fuel supplies. Kuwait-Iraq Border Reopens: The Abdali crossing reopened after a drone attack caused damage but no casualties, with both sides stressing “deep-rooted” ties and readiness to stop attempts to disrupt trade. KRG Fuel Price Review: Kurdistan officials are set to reassess proposed fuel price changes after meetings aimed at easing shortages and rising gasoline costs. Regional Diplomacy: Iraq’s PM is also set for visits to Ankara and Saudi Arabia, with talks expected to cover security cooperation and the war’s impact on regional stability.

Iraq–Syria Energy Pivot: Iraq’s cabinet approved steps to revive a pipeline linking Iraqi oil to Mediterranean export routes, authorizing Basra Oil to sign an MoU with Syria’s energy ministry and positioning the project as a hedge against disruptions on Gulf and Turkey-linked channels. Anti-Corruption Drive: Iraq’s Supreme Judicial Council seized IQD 27 billion in the Adnan al-Jumaili oil corruption case, with investigators tracing alleged waste-linked proceeds and continuing to pursue additional suspects and assets. Infrastructure Push: The Ministry of Transport says preliminary designs for the Development Road Project and railway corridor are 100% complete, moving into detailed engineering for bridges, stations and supporting facilities. Kurdistan Contract File: MPs are seeking to move Kurdistan Region contract employees onto permanent federal payrolls through the next budget law, aiming to resolve long-running job security gaps. Border Disruptions Ease: Kuwait reopened the Abdali crossing with Iraq after drone damage, restoring a key Safwan–Abdaly gateway for trade and passenger travel. Local Jobs Clash in Kirkuk: The Kirkuk Engineers Syndicate accused BP of sidelining local talent and demanded an 85% local hiring quota, warning of legal action and protests if ignored. Arbaeen Mobilization: Iraq declared public holidays for Arbaeen commemoration and religious authorities urged scholars not to discourage visits to Imam Hussein’s shrine as millions prepare to travel to Karbala.

Iraq-Kuwait Border Reopening: Kuwait says the Abdaly crossing with Iraq will reopen to passenger and commercial traffic within 48 hours after damage assessment following recent drone attacks, with both sides stressing “brotherhood” and renewed security coordination. PM al-Zaidi’s Diplomacy & Anti-Corruption: Iraq’s Victory Alliance backed Prime Minister Ali al-Zaidi, praising his anti-corruption push and his engagement with both Washington and Tehran after a US trip that produced dozens of agreements and a follow-up visit to Tehran. Arbaeen Pilgrimage Surge: Iraq reports more than 1.27 million foreign religious visitors entering since Muharram began, with 2025 Arbaeen totals cited as a benchmark for Karbala attendance. Economy & Energy Pressure: Iraq’s non-oil revenues hit a record 16% of total income in May-June, but officials warn Hormuz disruptions keep crude exports central. Oil Export Routes: Iraq’s delegation met Turkey to expand crude exports via the Iraq-Turkey pipeline toward Ceyhan, aiming to protect revenues amid regional security shocks. CBI Overhaul: The Central Bank approved a restructuring to strengthen oversight of non-bank financial institutions and adjust internal directorates ahead of a July 30 implementation. Security in Erbil: A booby-trapped drone was shot down near the US consulate in Erbil with no casualties reported, as the Kurdistan region faces repeated drone incidents.

US-Iran Escalation: The U.S. expanded strikes deeper into Iran, hitting bridges and infrastructure, while Iran continued targeting American strongholds across the Gulf; the Strait of Hormuz remains the flashpoint as Washington also fired on merchant vessels trying to breach its blockade. Regional Spillover for Iraq-Kuwait: Kuwait’s Abdaly border crossing was hit by repeated drone strikes, prompting temporary closures and heightened security at the Safwan link; Kuwait’s interior minister said ties with Iraq won’t be disrupted. Diplomacy Under Strain: Multiple reports say Iraq is not mediating a U.S.-Iran ceasefire proposal, as both Washington and Tehran signal no clear off-ramp. Women in Leadership: Iraq’s President Nizar Amedi urged political blocs to expand women’s representation in senior posts, including a push for a women’s affairs ministry. Arbaeen Green Push: Iraq’s Green Observatory called for lower plastic use, less food waste, and cleaner waste management by Arbaeen service tents. Pilgrimage Demand: Kurdistan Region received nearly 12,000 Hajj applications, with only about 5,120 expected to travel through the official process. Corruption Case Echoes: A new corruption-related report highlights gold bars and cash found hidden in Iraq, feeding renewed calls for accountability.

US-Iran Escalation in Iraq: The US carried out a strike near the Shalamcheh border crossing between Iraq and Iran, killing two and injuring 11, as fighting continues with a 13th straight night of US strikes and Iran targeting US-linked sites across the region. Security Alerts: The US issued new travel warnings for Americans in Iraq, Jordan and elsewhere, citing possible flight disruptions and airspace closures amid rising tensions. Drone Crackdown in Baghdad: Iraqi forces raided a PMF-affiliated site in Jurf Al-Naddaf after finding a drone manufacturing workshop allegedly used to target the US Embassy and Baghdad International Airport; authorities also cited earlier INSS action dismantling another drone facility. Iraq’s Development Stalls: Iraq’s Parliamentary Services and Reconstruction Committee says 1,800+ public projects are stalled nationwide, with major delays hitting electricity, water, sewage and roads. Diplomacy Through Baghdad: Prime Minister Al-Zaidi’s Tehran visit produced transport/rail agreements and a twinning arrangement, while Baghdad again rejected any plan to let its territory be used against Iran. Iraq Economy Track: Iraq accelerated World Trade Organization accession talks in Geneva as part of broader economic reform and diversification.