BAGHDAD: Iraq has failed to pay $1.6 billion owed to neighbouring Iran for gas imports, a debt needed to guarantee further supplies critical to prevent worsening power cuts, Baghdad’s authorities said Wednesday.

Payment of the debt was a key requirement to ensure energy supplies for Iraq’s power plants during the intense heat of the upcoming summer months, when electricity demands surge as people seek to keep cool.

“Iran had demanded the payment by Iraq of its financial obligations for the payment of the gas,” Iraq’s electricity ministry said in a statement.

However, due to “the delay in the adoption of the budget”, as well as parliamentary blockages stalling a bill aimed to guarantee debt payments in the electricity sector, this led to “delays”.

Supplies have already been reduced by five million cubic metres of gas per day, limiting the operation of the power stations and “reducing the hours of electricity supply”, the ministry added.

Despite its immense oil and gas reserves, Iraq remains dependent on imports to meet its energy needs.

Iran currently provides a third of Iraq’s gas and electricity needs, but supplies are regularly cut or reduced, aggravating daily load shedding.