The United States extended an exemption allowing Iraq to continue importing Iranian oil and gas despite US sanctions on Tehran, a US State Department spokesman confirmed.
The spokesman said recently that the 90-day extension would allow Baghdad to keep importing Iranian gas that is crucial for Iraqi power production.
"A 90-day waiver was granted to allow Iraq to continue to pay for electricity imports from Iran," the spokesman said, adding that the waiver will apply to both electricity and gas, as reported by Reuters.
The extension deal was reached on Thursday when a previous 45-day waiver was due to expire-during a visit to Washington by an Iraqi delegation, two Iraqi officials with direct knowledge of the negotiations said.
President Donald Trump's administration reimposed sanctions on Iran's energy exports in November.
The Trump administration gave Iraq a 45-day waiver for imports of gas from Iran when US sanctions came back into effect on 5 November.
Iraqi officials have said they need about two years to find alternative sources since the country relies heavily on Iranian gas to feed its power stations.
Iraq imports roughly 1.5 billion standard cubic feet per day via pipelines in the south and east.