Iraq oil revenues vulnerable to corruption, officials detained in Najaf

BAGHDAD, Iraq — Recent detentions of senior officials at Iraq's Oil Ministry and affiliated agencies have drawn attention to allegations of financial corruption in the country's petroleum sector, where political factions compete for influence over one of the government's most contested institutions. In Najaf, the director of an oil products distribution office was detained on charges of financial corruption. Earlier, the ministry's undersecretary responsible for liquidation affairs and the director general of the oil products distribution company were also taken into custody in connection with the same case. Under the Iraqi constitution and national law, oil revenues belong to the public and cannot be claimed by any official or political entity. Crude export earnings are first deposited into the IRAQ2 account at the Federal Reserve Bank of New York, then transferred to accounts at Iraq's Central Bank, and may be spent only under the federal general budget law. Experts say direct personal theft of these funds is difficult, and that leakage occurs primarily through institutional mechanisms, including commissions on state contracts, bribery and the sale of phantom positions. Analysts have recommended integrating digital governance tools such as e-procurement, electronic wallets and biometric registration through decentralized systems to break the cycle. Publishing budget files on open platforms and improving the traceability of contracts and payments, they said, would strengthen oversight bodies.