Iraq may soon hold talks with US banks for financing package

The Iraqi government is mulling going to US banks for a financing package to address its liquidity crisis, Iraq-based daily Shafaq reports, citing sources in the know. Resorting to commercial global banks is another signal that Iraq wants to avoid multilateral institutions like the IMF, whose lending comes with strings attached on politically sensitive issues like fuel and electricity subsidies. The backdrop of that direction, however, is debt that is more expensive to service.

Looking for a backup

Egypt is shoring up its LNG import capacity after its Damietta FSRU was damaged by a drone. The government is now weighing a roughly six-week repair by state-owned Petrojet for the FSRU, alongside the previously reported option of sending the vessel to Turkey for a roughly one-month repair, according to an unnamed government official. The vessel still has roughly 70k cbm of LNG onboard, which must be offloaded at either Ain Sokhna or Damietta before repairs can begin.

Building redundancy: Egypt is separately studying a lease of a second 150k cbm unit to dock at Ain Sokhna in September, alongside the Gazlog Salem, at roughly USD 75k a day, around USD 2.25 mn a month, according to another government source. The lease aims to build emergency reserves in case of delayed shipments or lower Israeli pipeline imports.

New beginnings

Libya’s National Oil Corporation says it wrapped the technical and mechanical work needed to restart the Zuwara desalination plant in western Libya — out of service for more than seven years. The gas required to run the plant has begun flowing to the plant’s pressure-reduction and metering system from the Mellitah Industrial Complex, according to a statement. NOC frames this as the second of several commissioning phases, meant to test pressure and readiness — not to switch the plant back on. Full water production still awaits further stages.

Why this matters: Libya’s desalination fleet nationally runs well under design capacity. A November 2024 meeting, chaired by Prime Minister Abdul Hamid Dbeibah, was told individual plants were producing at anywhere from 20% (Tobruk) to 50% (Derna) of capacity, with the Zliten plants offline entirely, Libya Observer reported then — the backdrop against which Zuwara’s slow reopening counts as progress.

Choppers on the way

The US State Department approved a USD 800 mn military helicopter sale to Iraq, with Bell-Textron of Fort Worth, Texas named as principal contractor. The deal is one of the larger US defense sales to Baghdad in recent years, and signals continued American military engagement with Iraq.

DATA POINT- US arms sales to the GCC only in our region quadrupled in 1H 2026 to reach USD 41 bn compared to all of the previous year, driven by a surge in air and missile defence contracts, AGBI reported.