Iraq and Iran: A Beneficial Partnership
Since the withdrawal of U.S. troops from Iraq, the country has developed a closer working relationship with its Shiite partner, Iran. While this relationship is not openly advertised, it is beneficial for Iraq and will help in establishing regional stability for two primary reasons. First and foremost, this partnership will help curb the spread of radical Islam throughout the region; countering the covert support that groups such as the Islamic State (IS) and al-Qaeda receive from the gulf states. Evidence of this counterterrorism partnership can be seen in the recent air raids which were launched against IS targets in Iraq by Iran. While both Iran and Iraq vehemently denied these airstrikes, the U.S. has acknowledged they occurred, but are not providing many details; most likely to avoid causing friction with Iraq’s government. Second, this partnership will lead to a reduction in oil prices and a bear market for crude, as Iran and Iraq are an excellent balancing force within OPEC. Inside the organization, Iran and Iraq have constantly competed against Saudi Arabia and its partners. Recently, Iran reduced its oil prices to match those of Saudi Arabia in Asian markets causing the crude benchmarks to slide further into a bear market.
While the U.S. and its allies may be wary of Iran’s growing influence in the Middle East, the reality is, Iran’s presence in the region is essential in establishing long-term stability. If anything, balancing the power of the gulf states will help curb the spread of radicalization in the region and will lower oil prices.