Iraq has ordered the freezing of financial assets belonging to several Iran-aligned militant groups, including Lebanon’s Hezbollah and Yemen’s Houthi movement.
The move is seen as one of Baghdad’s most assertive attempts yet to curb the financial networks of Tehran-backed organisations.
The directive was published in Iraq’s official gazette this week, confirming that authorities will “freeze the funds of Iran-backed armed groups, including Lebanon’s Hezbollah and Yemen’s Houthis.”
The move represents a significant policy shift at a time of rising regional tensions and mounting international pressure over Iran’s proxy operations.
The decision is expected to draw strong approval from Washington, which has long urged Baghdad to rein in the activities of militias linked to Iran.
U.S. officials argue that groups such as Hezbollah and the Houthis rely on financial pipelines, including some tied to Iraq, to sustain their military and political activities.
Analysts say the freeze confirms Iraq’s ongoing struggle to navigate its dual relationship with Washington and Tehran.
Iraq cooperates closely with the U.S. on counterterrorism and economic assistance, yet its political system and security architecture remain deeply influenced by Iran and its network of Shiite militia groups.
According to reports, “the move will likely be welcomed by Washington, which has long sought to reduce Iran’s influence in Iraq and across the Middle East.”
Iran, however, views Iraq as a crucial economic lifeline. With U.S. sanctions continuing to strain Tehran’s finances, energy and trade partnerships with Baghdad have provided essential economic relief.
As pointed out in the original briefing, “Iran sees its neighbour Iraq as vital to keeping its economy afloat under sanctions.”
Iran-backed militias, many operating under the Popular Mobilization Forces (PMF), remain dominant players in Iraq’s political and security landscape.
They hold influence in parliament, security agencies and key economic sectors, a reality that has long complicated Iraq’s foreign policy posture.
This latest action comes as Iran’s regional network faces intensified pressure.
Israeli strikes over the past year on Tehran-aligned groups in Syria, Lebanon, Yemen and Iraq have weakened several proxy organisations.
At the same time, Washington has demanded stronger action from Baghdad following a series of militia attacks on U.S. forces stationed in Iraq.
Some of those Iraq-based factions have publicly aligned themselves with Hezbollah and the Houthis, who have been blamed for targeting commercial vessels in the Red Sea amid the ongoing conflict in Gaza.
Baghdad has also come under pressure from Gulf states, including Saudi Arabia and the UAE, which accuse the Houthis of destabilising the region and threatening global maritime trade.
Iraq freezes assets of Hezbollah, Houthi, other Iran-backed militias
