Baghdad: An Intelligence Battleground in Iran’s Latest War

A flag of Iraq's pro-Iran paramilitary group Hezbollah Brigades (Kataib Hezbollah), flutters against the backdrop of people taking a swing ride at an amusement park during Eid al-Fitr celebrations, marking the end of the Muslim holy fasting month of Ramadan, in Baghdad on March 21, 2026. (Photo by AHMAD AL-RUBAYE / AFP)
A flag of Iraq's pro-Iran paramilitary group Hezbollah Brigades (Kataib Hezbollah), flutters against the backdrop of people taking a swing ride at an amusement park during Eid al-Fitr celebrations, marking the end of the Muslim holy fasting month of Ramadan, in Baghdad on March 21, 2026. (Photo by AHMAD AL-RUBAYE / AFP)
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Baghdad: An Intelligence Battleground in Iran’s Latest War

A flag of Iraq's pro-Iran paramilitary group Hezbollah Brigades (Kataib Hezbollah), flutters against the backdrop of people taking a swing ride at an amusement park during Eid al-Fitr celebrations, marking the end of the Muslim holy fasting month of Ramadan, in Baghdad on March 21, 2026. (Photo by AHMAD AL-RUBAYE / AFP)
A flag of Iraq's pro-Iran paramilitary group Hezbollah Brigades (Kataib Hezbollah), flutters against the backdrop of people taking a swing ride at an amusement park during Eid al-Fitr celebrations, marking the end of the Muslim holy fasting month of Ramadan, in Baghdad on March 21, 2026. (Photo by AHMAD AL-RUBAYE / AFP)

Within days of the outbreak of the US-Israeli war on Iran, Quds Force officers began arriving in Iraq to oversee “attrition operations” and establish a support command for the Iranian Revolutionary Guard Corps. The move reflects contingency planning for possible escalation inside Tehran.

At the same time, Baghdad has become a hub for espionage activity, with intelligence operations unfolding alongside the military conflict, according to sources cited by Asharq Al-Awsat. Sources report that in the immediate aftermath of the killing of Iran’s Supreme Leader, Ali Khamenei, communication between Iranian operatives and Iraqi militia leaders was briefly disrupted before being restored by the third day of the war, on March 3, 2026.

Iranian officers entered Iraq in stages to supervise attacks against US interests and allied targets. They are supported by long-established Iranian advisers inside Iraq who coordinate networks of armed groups across multiple factions. According to political and security sources, the strategy aims to “spread instability in areas hosting US interests” and ultimately “consolidate Iranian influence over Iraq after the war.”

Some analysts, however, view the operations as defensive, to protect missile and drone stockpiles supplied by Tehran for later use. They note that Iraqi militias lack the capacity for large-scale strategic warfare compared with Lebanon’s Hezbollah.

Sources familiar with meetings among Iran-aligned factions say Iranian officers have established an operations room in Baghdad to create a new deterrence framework against US forces and potentially serve as a fallback command center if conditions worsen in Tehran. Despite these efforts, Iranian activities in Baghdad have reportedly been exposed, leading to deadly strikes attributed to the United States that caused casualties among Iranian personnel.

Aftermath of Khamenei’s Killing

The first wave of Quds Force officers is believed to have arrived shortly after Khamenei’s death on Feb. 28, 2026. Iraqi sources suggest some personnel had already been deployed earlier, including operatives traveling on Iraqi and Lebanese passports who also moved to Beirut.

Shortly after Khamenei’s death, the umbrella group known as the “Islamic Resistance in Iraq” launched a series of attacks, claiming responsibility for 16 operations involving dozens of drones both inside and outside Iraq.

The network includes major militias such as Kataib Hezbollah, Harakat al-Nujaba, and Kataib Sayyid al-Shuhada, as well as smaller groups that emerge during periods of escalation, including Ashab al-Kahf and Saraya Awliya al-Dam. These are widely seen as front organizations for Iran-backed factions.

A protester in Baghdad holds a picture of Iranian Supreme Leader Ali Khamenei after the announcement of his death on February 28 (Reuters)

Once communications were restored, Iraqi officials sought clarity from Iranian counterparts about the trajectory of the conflict. According to one official, the response was that the Iranian leadership was focused primarily on retaliation and targeting US forces. Iranian officers have since established themselves in secure locations across Baghdad, Najaf, Diyala, and Basra, with Iraqi factions providing protection and logistical support. A senior militia figure stated that Iran has mobilized groups it has cultivated over many years for what it views as a decisive confrontation.

Assessments from militia sources indicate that the current level of engagement exceeds that seen after Oct. 2023, driven by concerns that a collapse of Iran’s political system would threaten the survival of these groups in Iraq. One source cited anger and a desire for revenge as key motivations, while another emphasized that these groups were specifically designed for such a conflict and remain closely tied to Iranian command structures.

Analysts argue that the operations are effectively directed by Iran, with Iraqi factions serving primarily as a local cover. Political researcher Akeel Abbas noted that militia actions are “essentially extensions of the Revolutionary Guard operating under a local façade.”

A Fragile State Position

An Iraqi government official warned that the likelihood of keeping militias out of the conflict is diminishing as the war continues. He described the state as “an invisible presence caught between two fighters,” noting that confronting the militias could risk direct conflict with Iran or trigger internal Shiite divisions.

Another militia leader suggested that the war has clarified the balance of power in Baghdad, reinforcing the dominance of armed factions. Initial attacks focused on US diplomatic facilities in Baghdad and Erbil, along with military bases. They later expanded to include Iraqi radar systems and government communications infrastructure.

Sources estimate that more than 15 US and French radar systems - part of contracts signed since 2022 worth roughly $350 million - have been destroyed. The objective, they say, was to disable drone detection capabilities and prevent surveillance of Iranian movements. Iraqi military officials declined to comment on the extent of these losses or those responsible. Instructions to militias reportedly include severing intelligence-sharing and operational coordination between Iraqi security agencies and the United States.

Attacks have also targeted Camp Victory, a logistical base near Baghdad International Airport used by US forces and Iraqi units. According to an Iraqi officer, some explosive-laden drones struck service facilities used by Iraqi personnel located near US positions.

A Decentralized Strategy

The deployment of Iranian officers to Iraq is also intended to establish an alternative command structure in what sources describe as “a friendly country that provides political and security cover.” According to these sources, part of the Islamic Revolutionary Guard Corps’ activity in Iraq is designed to relieve pressure caused by US and Israeli strikes inside Iran.

They added that Iraq offers faster and more reliable communication channels with regional allies than those available in Tehran, making it effectively “the last regional arena” for the Revolutionary Guard. Observers believe Iran’s security system is designed to function in a decentralized manner. A Shiite source said the plan includes protecting a core group of elite officers in case assassinations escalate inside Iran.

Sources also revealed that Iran has activated a “backup plan” built around mixed, hard-to-trace cells drawn from different armed factions. Those networks that had been quietly prepared over several years.

This escalation coincided with a rare public statement by Esmail Qaani, commander of the Quds Force, in his first remarks since the killing of Ali Khamenei. He praised Tehran’s allies in what he called the “axis of resistance” for confronting the United States and Israel.

Although Qaani stressed the “independence” of these groups, he effectively reaffirmed control over a broad, multi-layered network operating under a flexible, decentralized structure.

Iraqi politician Hamed al-Sayed said Qaani’s statement clarified his central wartime role: managing Iran’s networks of influence abroad. He added that Iraq’s importance requires direct Iranian oversight of armed factions, as developments there could threaten political gains linked to Iran’s ruling system. While this model is not new, al-Sayed noted that what has changed is “its intensity and its integration into a wider regional war.”

Sources told Asharq Al-Awsat that Iran’s current strategy operates on a broader scale, aiming to “spread disruption and instability across multiple arenas, including areas previously considered outside the conflict.”

A photo distributed by the government’s media office on March 22 shows Prime Minister Mohammed Shia al-Sudani (right) inspecting the damage after a drone attack targeted a building belonging to the intelligence service in Baghdad

Baghdad: A City of Spies

The military escalation has been accompanied by what sources describe as an intense intelligence war inside Baghdad, peaking with attacks on sensitive sites, including facilities belonging to Iraq’s intelligence service.

On March 21, the agency announced that one of its officers had been killed in what it described as a terrorist attack carried out by outlaw groups. Two days later, Kataib Hezbollah claimed that 90 percent of the agency’s personnel had been infiltrated, even naming a specific officer accused of leading a network that leaked information to foreign actors.

Sources said armed factions strongly suspect the intelligence service to be one of the few government institutions still maintaining close ties with the United States. They believe a faction within the agency has been supplying intelligence and coordinates on militia and Iranian movements.

According to these accounts, the agency has come under mounting pressure during the war, as a parallel intelligence conflict unfolds between Iranian operatives, Iraqi intelligence officers, and US CIA personnel, each side attempting to outmaneuver the others. In this environment, Baghdad has at times become a deadly espionage battleground.

One source said these groups have been monitoring one another closely since the war began, tracking movements street by street across the capital.

However, many observers question claims that Iran was behind the attack on the intelligence facility, attributing it instead to internal political rivalries among Shiite factions that have spilled over into the agency, which has long struggled to remain independent.

The Jurf al-Sakhar Trap

Iranian coordination with armed factions appears to have created a classic intelligence vulnerability. Their increasingly visible activities made it easier for US forces to detect and track them, according to assessments circulating among members of those factions.

Sources confirmed that a strike — widely believed to have been carried out by the United States — on the town of Jurf al-Sakhar, south of Baghdad, in early March 2026 marked the first direct US targeting of Revolutionary Guard activity in Iraq following Khamenei’s killing.

Jurf al-Sakhar has been a major stronghold for Iraqi factions since 2014 and is believed to have evolved into a strategic military hub, housing training camps, detention facilities, storage depots, and sites for missile and drone development.

Political analyst Akeel Abbas described the strike as “the most significant in the Iraqi theater, as it targeted command-and-control structures.”

Sources, including individuals close to armed factions, said the area has shifted from being a strategic asset for Iran’s allies into a growing intelligence liability, threatening the core of their security and economic operations.

Subsequent strikes in Baghdad’s Karrada and Jadriya districts were reportedly aimed at senior Iranian figures. Abbas noted that the Jadriya strike in particular appeared intended to eliminate those directing operations linked to Jurf al-Sakhar. A resident of Jadriya told Asharq Al-Awsat that the targeted house had long been used by Iranian figures, whom locals had assumed were part of the Iranian diplomatic presence.

Fragile Ceasefire and Continued Strikes

Following these developments, Kataib Hezbollah announced a conditional unilateral ceasefire, pledging to halt attacks on the US embassy in Baghdad in exchange for an end to Israeli strikes in Beirut’s southern suburbs. However, the group Ashab al-Kahf violated the ceasefire within two days.

Later statements attributed to armed factions claimed that the United States had sought a temporary truce to allow its forces to withdraw. Pro-Iran activists circulated nighttime footage allegedly showing US military vehicles leaving Iraq overland toward Jordan.

The US State Department and the embassy in Baghdad declined to comment on reports of indirect negotiations with Iraqi factions. However, a diplomatic official told Asharq Al-Awsat that US air operations against Iran-aligned targets in Iraq “will continue until their operational capabilities are dismantled.”

Toward a “Final Battle”?

Hadi al-Amiri, leader of the Badr Organization, called on the Popular Mobilization Forces to mobilize for what he described as a “battle of truth against falsehood.” The group has suffered significant losses in US strikes targeting sites in Salah al-Din and Kirkuk.

Abbas does not expect this mobilization to escalate into full-scale war alongside Iran. He argues that Iraqi factions primarily serve logistical functions, including storing missiles and drones that Iran could deploy if pressure intensifies inside Iran or on Hezbollah’s front.

He added that these factions do not constitute a decisive fighting force on their own but operate as instruments of the Revolutionary Guard, reinforcing the idea that Iraq is being used as a strategic pressure platform.

In contrast, Shiite leaders in Baghdad increasingly believe that the Revolutionary Guard is preparing the capital for a “final battle” that may become necessary in its confrontation with the United States.

One such leader told Asharq Al-Awsat that a key lesson drawn by the Revolutionary Guard is the need to implement sweeping changes to Iraq’s political and security systems, including abandoning previous rules governing engagement with international actors.

Another Shiite leader said armed factions have long sought to bring remaining independent security institutions under their control. These assessments align with broader indications that Tehran, in the absence of a political settlement with Washington, may attempt to impose a new reality of direct influence in Iraq, reshaping the country’s governing structure. One political figure suggested this explains “why Iran has delayed the formation of a new Iraqi government until after the war ends.”



Iraq Opens Special Account for Recovered Illicit Funds as Anti-Corruption Drive Expands

Iraqi police personnel patrol in their vehicle along a street in Baghdad on June 28, 2026. (AFP)
Iraqi police personnel patrol in their vehicle along a street in Baghdad on June 28, 2026. (AFP)
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Iraq Opens Special Account for Recovered Illicit Funds as Anti-Corruption Drive Expands

Iraqi police personnel patrol in their vehicle along a street in Baghdad on June 28, 2026. (AFP)
Iraqi police personnel patrol in their vehicle along a street in Baghdad on June 28, 2026. (AFP)

Iraqi Prime Minister Ali al-Zaidi ordered on Monday the Finance Ministry to open a dedicated account for money recovered from illicit enrichment cases, as the government pressed ahead with its anti-corruption campaign. Meanwhile, the Federal Commission of Integrity said a draft law on asset recovery will soon be submitted to parliament.

Government spokesman Haider al-Aboudi revealed that the new account would hold funds recovered from people convicted of illicit enrichment, stressing that the government remains committed to protecting public money and strengthening state institutions.

In remarks to the state-run Iraqi News Agency (INA), al-Aboudi said the government had adopted a comprehensive approach to institutional reform and combating corruption.

He added that Operation Dawn had resulted in the arrest of 21 suspects, while others remain at large.

Investigators are using suspects’ confessions to uncover broader corruption networks involving additional individuals and assets, he revealed.

Separately, Abbas Mutib, director general of the Integrity Commission’s asset recovery department and deputy chairman of the Iraq Asset Recovery Fund, said the commission had made significant progress in digital transformation, enabling it to freeze substantial assets abroad and prevent those accused of corruption from disposing of them.

Mutib noted that the commission is coordinating with the Justice Ministry to pursue civil lawsuits aimed at recovering frozen assets overseas, adding that authorities have already succeeded in recovering sizable sums.

Former tax chief sentenced

The Federal Commission of Integrity also announced prison sentences against former General Commission for Taxes Director General Osama Hossam Jawdat and his wife after their conviction on money laundering charges.

According to the commission, the Central Criminal Court for Combating Corruption sentenced Jawdat to 10 years in prison and his wife to five years and one month under Iraq’s 2015 Anti-Money Laundering and Counter-Terrorism Financing Law.

The court ordered the couple to pay a fine of IQD 32.496 billion (about $25 million), confiscated 10 properties in Baghdad and 12 properties in Türkiye registered in the wife’s name, as well as seized cash, rental income, gold jewelry, and funds deposited in Kuwaiti and Turkish banks. It also ordered the freezing of their movable and immovable assets.

Broad public backing

An Iraqi security personnel stands guard along a street in Baghdad on June 28, 2026. (AFP)

The government’s sweeping arrests on Sunday have drawn strong political and public support after targeting senior officials, lawmakers, and government directors, raising hopes that Iraq may finally curb corruption, which unofficial estimates say has cost the country more than $500 billion.

More than 50 suspects have been arrested so far, while some estimates suggest the number of wanted individuals could eventually exceed 1,000.

Dozens of activists gathered Sunday evening in Baghdad’s Tahrir Square to express support for the campaign.

Influential Shiite cleric Moqtada al-Sadr praised the “heroic reform measures,” saying the arrests had restored hope among Iraqis after years of entrenched corruption.

He commended the judiciary and security forces, particularly the Counter Terrorism Service, for carrying out the arrests.

More arrests expected

Ghalib al-Daami, a lecturer at the Iraqi Academy for Combating Corruption, told Asharq Al-Awsat that more than 50 prominent figures had already been detained and predicted the campaign could ultimately target more than 1,000 individuals.

While many observers doubt the crackdown will reach Iraq’s most powerful political leaders, al-Daami said he expects the “downfall” of three senior political figures in the coming days.

He also claimed the campaign has received direct US backing, particularly following the arrest of former Deputy Oil Minister Adnan al-Jumaili and another deputy minister, Ali Maarij al-Bahadli, who has been sanctioned by the US for allegedly facilitating Iranian oil sales.

Political scientist Firas Elias of the University of Mosul said the campaign represents “a real test of the state’s authority.”

Its success should be measured not by the number of arrests but by its ability to secure fair convictions and recover stolen assets, he added.

If the law is applied equally to everyone, the campaign could mark a turning point in relations between the state and Iraq’s political class, he remarked. But if it stops with selected figures or becomes a tool for settling political scores, it will quickly lose credibility and allow corruption to reemerge in new forms.


Gazans Turn to Clay, Rubble to Build New Homes

A Palestinian boy makes his way across rubble near a displacement camp in Nuseirat, in the central Gaza Strip, on Sunday. Credit: AFP/EYAD BABA
A Palestinian boy makes his way across rubble near a displacement camp in Nuseirat, in the central Gaza Strip, on Sunday. Credit: AFP/EYAD BABA
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Gazans Turn to Clay, Rubble to Build New Homes

A Palestinian boy makes his way across rubble near a displacement camp in Nuseirat, in the central Gaza Strip, on Sunday. Credit: AFP/EYAD BABA
A Palestinian boy makes his way across rubble near a displacement camp in Nuseirat, in the central Gaza Strip, on Sunday. Credit: AFP/EYAD BABA

While Gaza’s housing crisis remains catastrophic with cement and steel blocked by Israel from entering the Strip, some Palestinians are turning to improvised methods and other workarounds in a bid to make their shelters safer or more habitable.

Among those Palestinians is Jaafar Atallah, a potter in Gaza, who decided to build a home from the earth. It was to be like the bread ovens his family had been making for generations, but big enough for his parents to live in, according to the Financial Times.

Atallah gathered clay from an area of Gaza a few kilometers from his tent and — with the help of about 15 people, including his father, also a potter — he set about making mud bricks.

For months, they learned as they built. Finally, they completed a domed hut, “so solid you could stand on top of it”, said Atallah, whose project was backed by pottery groups around the world after he shared videos online.

The clay structure was a relief after the flimsy protection of the tent: “You can keep your food in this room. In a tent, tomatoes and cucumbers won’t last a day and will rot. Life in the tents is so hard. There is such heat in the summer, it is torture,” Atallah said.

Atallah’s experience reflects the reality of thousands of families looking for alternatives after almost all buildings in Gaza have been destroyed by two years of bombardment amid Israel’s ban on concrete and steel imports.

Several Gazans are reusing steel reinforcing bars and concrete from the debris of buildings, scavenging for cement lying underwater in the port and resorting to mud to make bricks and mortar.

“We already have clay in our land, we don’t have to manufacture it, we don’t need things that we have to get from the crossing [with Israel], which is at the whim of the occupation,” said Atallah, who even designed a waterproof glaze for the bricks. “The occupation does not control this. It’s from our land, our soil.”

According to the UN, 1.9 million Gazans are displaced or live in tents, which lack sanitation or other utilities.

Reconstruction of Gaza remains a distant dream for its people. Israel bans building materials from entering Gaza on the grounds that the materials may be used for military purposes such as tunnel construction.

In May, teenage sisters Tala, 17, and Farah Moussa, 15, won a youth-focused award from the Swiss-based Earth Foundation for recycling cement debris into bricks.

Displaced with their family five times since the start of the war, they now live in a tent in Nuseirat in the center of the Gaza Strip. “We got the idea when our house was bombed,” said Tala. “We thought we had to do something and find a solution that comes from the problem itself, so we are using the rubble.”

Tala said, “We made five or six prototypes before we got it right. We researched on the internet and in books. Now we want to use the [$12,500] prize money to set up workshops to teach others how to make bricks.”

Using mud and stones, Gaza residents rebuild homes destroyed in months of conflict, as lack of access to construction material leaves families with few options.

Their efforts reflect the ability to adapt to the most extreme conditions to restore a normal life, even within walls built from the earth and the debris of buildings.


Yemen Seeks Resumption of US Investments in Energy Sector

Al-Alimi during his meeting with the delegation from Hunt Oil Company (Saba)
Al-Alimi during his meeting with the delegation from Hunt Oil Company (Saba)
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Yemen Seeks Resumption of US Investments in Energy Sector

Al-Alimi during his meeting with the delegation from Hunt Oil Company (Saba)
Al-Alimi during his meeting with the delegation from Hunt Oil Company (Saba)

The head of Yemen’s Presidential Leadership Council (PLC), Rashad Al-Alimi, has met with a delegation from the American Hunt Oil Company, headed by the company’s Chief Executive Officer, Hunter Hunt.

The meeting on Sunday reviewed opportunities for partnership between the Yemeni government and Hunt Oil in the exploration, production, and export of oil and gas. It also discussed prospects for the company to resume its investments in Yemen in support of the country’s economic recovery and energy security.

Al-Alimi was briefed by the delegation on the company’s current operations, future plans, and promising investment opportunities in Yemen’s oil sector, building on its long-standing partnership with the Yemeni government.

The PLC President praised Hunt Oil’s pioneering role in establishing Yemen’s petroleum sector, including the discovery of the country’s first commercially viable oil reserves, its contributions to developing oil infrastructure, training national personnel, and its role as a key partner in the Yemen LNG project.

He said these contributions would remain a source of appreciation for both the government and the Yemeni people.

Al-Alimi also outlined the economic, financial, and administrative reforms being implemented by the government, particularly in the oil and gas sector.

He highlighted efforts to improve the investment climate, strengthen transparency and governance, and provide the necessary guarantees for the return of foreign companies across various sectors.

He commended Saudi support to Yemen’s economy, describing it as a key pillar for enhancing stability, advancing economic reform, and restoring investor confidence.

The PLC President reaffirmed the state’s commitment to providing all necessary support and facilities for investors. He said the government would work with regional and international partners to secure vital infrastructure and create conditions for the resumption of production activities.

He added that improving living standards and security across the country remains a top priority for the Yemeni government.