On Tuesday, the Iraqi Oil Marketing Company (SOMO) firmly denied any cases of mixing or smuggling crude oil or petroleum products at Iraqi ports or in its territorial waters, reiterating its commitment to transparency and compliance with export regulations.
This denial follows the US State Department's 2 September announcement sanctioning companies and ships, led by Waleed al-Samarra'i, for allegedly smuggling Iranian oil falsely labelled as Iraqi.
"All exports are rigorously monitored and follow a precise system from loading to delivery," SOMO General Manager Somar Ali Nizar Al-Shatri told the Iraqi News Agency (INA) on Wednesday.
Thomas Pigott, Principal Deputy Spokesperson for the US State Department, claimed in a statement: "Today, the United States is acting decisively to stem the flow of revenues to the Iranian regime for its destructive and destabilising conduct in Iraq, the Middle East, and around the world. Among those sanctioned today are a network of companies and vessels led by businessman Waleed al-Samarra'i (al-Samarra'i), a dual citizen of Iraq and Saint Kitts and Nevis, for smuggling Iranian oil disguised as Iraqi oil."
Pigott added that the US will keep pressuring Iran and use every tool to stop those aiding its illegal oil trade.
In July 2025, a group led by Salim Ahmed Said faced similar sanctions for smuggling both Iraqi and Iranian oil.
Al-Shatri reiterated SOMO's firm denial of any mixing or smuggling of Iraqi oil at ports or within territorial waters. He emphasised, "All oil tankers are monitored in real time from loading until arrival at refineries or importing companies."
He said SOMO uses up-to-date tracking systems, including those from the US company Kepler, to track tanker locations. Any unexplained stops are quickly reported.
Al-Shatri also noted that oil products are sold openly through international auctions with standard pricing. "Every amount is carefully recorded, and all sales and payments go through clear, internationally controlled banks, so there is no chance for cheating," he said.
He also stated that several authorities, including the Iraqi Ports Company, the Iraqi Oil Tankers Company, the Maritime Transport Company, and security officials, oversee export operations. They are all notified immediately if anything unusual occurs.
Addressing unknown tankers, Al-Shatri clarified: "Unknown does not mean smuggling. Many belong to other ministries like Industry or Defence and carry materials such as chemicals or asphalt, which SOMO does not handle."
He said SOMO verifies unidentified tankers with authorities. "Most belong to official entities or never enter Iraqi waters, despite attempts to conceal their presence," he said.
Al-Shatri concluded: "The company keeps an updated record of every Iraqi oil tanker and fully coordinates with security and regulatory authorities."
Bahrooz Jaafar, Ph.D. in International Relations and head of the Mediterranean Institute for Regional Studies, told The New Arab that while the US is widely seen as a global advocate for democracy, its counterterrorism investments have yielded few lasting results.
"Iraq suffers institutional weakness. Corruption, bribery, and smuggling are systemic. Oil smuggling is not new—oil has long been illegally exported, including Iranian oil labelled as Iraqi with forged documents, through Basra port. While this may surprise some US institutions, it's widely known among Iraqi intermediaries and currency operators," he said.
He questioned the purpose of the US presence in Iraq, as most of its energy sector is operated by Russian and Chinese firms, and militia members are funded by the state.
Jaafar added, "The US and its allies must take a harder look at who is enabling the smuggling operations. It's time for honest reflection—especially considering that many of Iraq's senior officials, from top to bottom, hold US or UK passports, yet their political actions often directly contradict Western policies."
In July, Iraqi officials moved to block potential US sanctions on the country's vital oil sector after Washington accused Iran of smuggling crude through Iraq, three officials told Al Araby Al Jadeed, the Arabic-language sister site of The New Arab. The U.S. Navy said it found Iraqi shipping documents on seized Iranian tankers, prompting concern that sanctions could hit SOMO itself — a step Iraqi officials warned would trigger a "big and real crisis."