Iraqi PM meets US energy secretary on Iran oil sanctions

US Energy Secretary Rick Perry signaled an intention to boost private sector investment in Iraq, as his country's sanctions against Iran threaten Baghdad's energy needs.

Perry spoke at a Baghdad hotel where he was attending a US chamber of commerce event alongside Iraqi Oil Minister Thamer Ghadhban, Reuters reported.

US sanctions began on Iran in May, when the US pulled out of a landmark 2015 nuclear agreement with Tehran. A tougher set of sanctions targeting Iran's oil industry was enforced in November, aimed at economically crippling Tehran.

Baghdad, an ally of both Washington and Tehran, relies heavily on Iran to provide it natural gas and electricity, and feared that supply would be endangered by Washington's measures against Iran's energy sector.

It was granted a 45-day waiver to sanctions, but Iraqi officials say they need more time to find an alternative source.

"Sanctions were mentioned in meetings this morning," Perry said without providing details.

Perry, who met Prime Minister Adel Abdel-Mahdi on Tuesday, added he believed his attendance sent a message of US commitment to Iraq's economy and energy sector and that he recognised the challenges faced to rebuild oil infrastructure destroyed when Islamic State militants overran parts of Iraq.

"This is a different administration that will move with speed to develop an energy sector that best serves the citizens of Iraq," Perry said of Prime Minister Abdel-Mahdi's new government.

According to the prime minister's office, Perry "reiterated the support of his country to the Iraqi government in all fields and heading towards bolstering the stability, reconstruction of Iraq, the development of the economy, especially in energy projects".