ERBIL, Kurdistan Region of Iraq - Iraqi Oil Minister Hayyan Abdul Ghani revealed on Sunday that Iranian oil tankers detained by US forces in the Gulf were using fake Iraqi documents to facilitate oil smuggling.

Speaking to reporters, Abdul Ghani said that the US had made “verbal inquiries” about this matter, stating that the ships in question were “Iranian tankers using forged Iraqi documents.”

The revelation has sparked fears that Iraq’s State Organization for Marketing of Oil (SOMO) could face international legal consequences for violating US sanctions on Iran. However, experts affirm that Iraq acted properly by reporting the forgeries upon discovery.

International law expert Habib al-Quraishi told The New Region that Iraq was not a partner in the alleged scheme and had taken legal action. “Iraq is the one that exposed the smuggling and reported it. That protects it from legal or financial penalties,” he said, adding that “Iraq’s legal position is very strong.”

Nawar al-Saadi, a professor of international economics, said the Iraqi government acted transparently by notifying the US about the fake documents. “This shows Iraq wants to avoid legal and economic fallout,” he said. Still, he warned that incidents like this could make investors and international partners nervous, especially if Iraq doesn't take steps to stop similar issues in the future.

Saadi warned that if sanctions were placed on Iraqi oil or SOMO, the impact could be severe, with “any disruption in oil sales would cause a sharp drop in income and lead to a larger budget deficit.”

“This is why Iraq must take strong steps, not just exposing fraud but also improving oversight and preventing the misuse of Iraqi documents in oil trade,” Saadi cautioned. “Iraq has to prove it can protect its economy and not let others use its name or resources in risky operations.”

In response to Abdul Ghani’s comments, Iran’s Deputy Oil Minister for International Affairs, Ali Mohammad Mousavi, dismissed the claims as false.

He said the Iraqi minister’s remarks were based on what US authorities had told him. “These claims are part of an illegal and unjust US policy to make baseless accusations and pressure the Iranian people,” Mousavi said. “They are not true and have no credibility.”

In past reports, Reuters outlined a complex fuel smuggling network operating in Iraq, sometimes using fake documents. It is believed this trade brings in at least $1 billion annually for Iran and its allies.