Many Middle East governments are suspicious about the new Iran nuclear deal. But Iraqi authorities are embracing it — hoping it will reinvigorate the fight against Islamic State militants by easing friction between this country’s two main allies: the United States and Iran.

Since the Islamic State rampaged across Iraq last year, Baghdad has leaned on both Washington and Tehran for assistance on the battlefield. Iraqi officials say they have felt pulled between their most important partners.

Thousands of U.S. and Iranian military advisers assist Iraqi forces, but the two countries have been cautious not to be seen as working together. Iraqi officials say that wariness has at times hindered operations against the militants.

President Obama said Wednesday that he does not see a “formal set of agreements” with Iran on fighting Islamic State militants but added that Iran clearly has influence in Iraq and that some of the country’s actions are helpful.

He said U.S. officials would do their best to “de-conflict” efforts by the United States and Iran in the country, but added he did not want U.S. troops “looking over their shoulders” nervously because they were in close proximity to Iranian-backed militias that once fought them.

What's next for Iran after the nuclear deal

“The relationship between the United States and Iran, and the tension that is there, has had a negative effect on Iraq,” said Saad al-Hadithi, a spokesman for Iraqi Prime Minister Haider al-Abadi. “We hope the deal will fix this and create some stability.”

Iraqi officials point to the battle for the Sunni city of Tikrit, 110 miles north of Baghdad, as the most striking example of how U.S.-Iranian tensions have hampered operations. Abadi asked for airstrikes on the city by the U.S.-led coalition when an offensive led by Iranian-backed Shiite groups stalled on its outskirts in mid-March.

But when he did so, he faced fierce rebukes from militia groups, as well as demands from the United States that Iraq’s army and police forces lead the assault.

“There was clearly a struggle between the U.S. and Iran for the upper hand,” said Ibrahim Bahr al-Uloum, a Shiite politician.

U.S.-Iranian wrangling may also have played a role in the loss of Ramadi to Islamic State forces in May. The city had been defended by U.S.-backed Iraqi forces, and the U.S. government was uneasy about allowing Shiite militias to launch operations in the largely Sunni province, for fear the fighters might commit atrocities.

Since Ramadi fell, U.S. objections to the use of Shiite militias have lessened, Uloum said. Still, there have been clear divisions over the latest offensive for Anbar province, with Iran-backed Shiite militias moving on Fallujah, while U.S.-backed army and police focus their efforts on Ramadi, 40 miles farther west.

“The Iran-phobia in the minds of the Americans and the premise that everything bad in Iraq is caused by the Iranians, as well as the Iranian obsession about the U.S. role in Iraq, they just aren’t helping,” said Mowaffak al-Rubaie, a Shiite politician. “So any positive step in the Iran-U.S. relationship will reflect here.”

One concern for Iraq is the economic impact of Iranian oil coming onto the market, as sanctions are lifted under the new deal. This comes as Iraq, which relies heavily on petroleum exports, is struggling to balance its books and is sensitive to further drops in oil prices.

“We are suffering from many shocks — from ISIS, the oil prices, 3 million internally displaced people” due to fighting, said Hoshyar Zebari, Iraqi’s finance minister, using an alternative name for the Islamic State.

The lifting of sanctions would mean Iran could raise oil exports by 1 million barrels a day, nearly doubling its output, Iran’s oil minister, Bijan Namdar Zanganeh, has said. Zebari acknowledged that downward pressure on oil prices would hurt Iraq, but said that his country would also benefit as Iran’s economy grows with the lifting of economic sanctions.

While Iraq’s Shiite-led government might be welcoming of the nuclear deal, the country’s minority Sunnis are more skeptical. They complain of being increasingly marginalized politically as Iran extends its political and military influence here in the wake of the advances by Islamic State last summer.

With sanctions lifted on Iran, that may only get worse, they fear. The nuclear deal is set to unlock $100 billion in Iranian oil and gas revenue frozen overseas.

“We are afraid that the lifting of all the embargoes will allow them to meddle more in Iraq,” said Hamid al-Mutlaq, a Sunni politician on the Iraqi parliament’s defense and security committee. The Iranian influence “has created sectarian politics and sectarian killings, fellow Iraqis taking Iraqi blood.”

Mutlaq said he hoped there would be international pressure on Iran to curb its expansionism. “They are not going to do it without” such pressure, he said.

Read more

Fall of Ramadi raises new questions about U.S. strategy in Iraq

Iraq labors to repopulate Tikrit after chasing out Islamic State

Pro-Iran militias take upper hand after U.S.-backed forces crumble in Anbar

Mustafa Salim contributed to this report.