US lifts sanctions on Fly Baghdad airline and two aircraft

The United States lifted sanctions on Iraq's Fly Baghdad Airlines and two of its Boeing 737 aircraft on August 5, 2026, reversing a 2024 designation that had accused the carrier of supporting Iran's Islamic Revolutionary Guard Corps Quds Force. The action by the Treasury Department's Office of Foreign Assets Control allows the airline to regain access to international banking and resume operations, but its chief executive remains under sanctions.

The airline, along with its aliases Fly Baghdad Airlines Company and Iraq Express, was removed from the Specially Designated Nationals list. The two specific aircraft, with tail numbers YIBAF and YIBAN, were also delisted. A Treasury official, speaking anonymously, stated that the airline had demonstrated major changes to its operations such that its listing was no longer warranted. The official emphasized that the delisting does not signal a shift in U.S. policy toward Iran, the IRGC Quds Force, or other designated terrorist organizations.

However, the airline's CEO, Basheer Abdulkadhim Alwan Al-Shabbani, remains on the sanctions list. In a notable technical adjustment, his designation was rewritten to link him directly to the IRGC...