Iraq’s Prime Minister Ali al-Zaidi has announced a deadline for all pro-Iran militias to disarm by September 30, 2026. This ultimatum aligns with the scheduled end of the US-led coalition’s mission against ISIS in Iraq and is part of a broader government effort to consolidate state control over armed factions. The deadline follows pressure from the United States on Baghdad to disarm Iranian-backed groups such as Asaib Ahl al-Haq and Harakat Hezbollah al-Nujaba, both labeled as terrorist organizations by the US. The move is seen as part of Iraq’s strategy to enhance sovereignty and regional security ahead of Prime Minister Zaidi’s anticipated visit to the White House in mid-July.

Key Takeaways

• The disarmament deadline appears to increase tensions in US-Iran relations, which could impact ongoing diplomatic efforts.
• Market pricing suggests a decrease in the likelihood of a US-Iran deal, with odds for Iran Reconstruction Funding in a 2026 deal dropping.
• The announcement is consistent with Iraq’s attempts to assert state authority and manage armed groups within its borders.

What to Watch

Observers will be monitoring the response of pro-Iran militias to the disarmament deadline, as well as any retaliatory actions that might influence US-Iran negotiations. Prime Minister Zaidi’s upcoming visit to the White House could provide further clarity on Iraq’s role in regional security and its implications for US-Iran relations. Any developments in the geopolitical landscape, particularly related to Iran’s nuclear activities or US military positioning, may impact market expectations on a potential deal.

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