In July 2025, Baghdad and Washington finalized a phased withdrawal framework. U.S. combat forces will exit central and western Iraq by December, while counterterrorism and training operations continue from Kurdistan. After sustained pressure from Iraq’s legislature and Iran-aligned factions, both sides celebrated the compromise.
The pattern has become familiar: each American intervention promises to be the last, each drawdown is supposed to mark a new chapter of Iraqi self-reliance. Yet Iraq’s underlying fractures, sectarian divisions, weak institutions, and competing foreign influences remain as deep as ever. What changes is not the fundamental instability, but rather who benefits from it. A new U.S.–Iraq withdrawal deal promises a “complete exit” from central and western Iraq. On the surface, it looks like a victory for Iraqi sovereignty and a step toward ending America’s forever wars. In reality, it’s neither.
U.S. forces are not leaving Iraq. They’re relocating to Kurdistan, the one region that welcomes them, while vacating areas where security is most fragile. Roughly 2,500 U.S. troops still remain in Iraq as of mid-2025, largely in advisory roles. This redeployment protects American lives but shifts power within Iraq in ways that could ultimately strengthen Iran.
Mostly Theater
Iraqi Prime Minister Mohammed al-Sudani faces heavy pressure from nationalist politicians and Iran-backed militias to push out foreign forces. Framing the withdrawal as a triumph for sovereignty helps him project strength and score electoral points. The political calculus is clear: being seen as the leader who expelled foreign forces plays well domestically, especially among Shia constituencies who view the American presence as an occupation. It also helps al-Sudani navigate between competing pressures from Washington and Tehran. But declaring victory and achieving it are different things entirely.
But sovereignty here is optics, not reality. Remnants of the Islamic State still launch over 100 attacks a year, according to UN reporting. U.S. officials estimate that 1,500–3,000 Islamic State fighters remain active across Iraq and Syria. Militias remain armed, entrenched, and politically influential. For many Iraqis, sovereignty looks more like insecurity.
For Washington, this shift is less about strategy than survival. U.S. bases in Baghdad and Anbar have long been targets for rockets and drones launched by Iran-aligned militias. Since October 2023, there have been more than 180 such attacks across Iraq and Syria. One of the most serious incidents came in early 2024, when drones hit Ain al-Asad airbase in Anbar, injuring U.S. personnel. That single attack underscored the constant risk: any American casualties could trigger a political storm back in Washington. In an election year, candidates from either party don’t want to explain why Americans are still dying in Iraq.
By shifting forces to Erbil in Kurdistan, the United States reduces exposure while maintaining a foothold. From there, it can still track the Islamic State and reach into Syria. Call it a drawdown, call it a repositioning, but it’s not departure. It’s a relocation under fire.
Kurdistan Gains New Leverage
The quiet winner is the Kurdistan Regional Government (KRG). Hosting U.S. forces boosts Erbil’s security, strengthens its bargaining power in oil revenue and territorial disputes with Baghdad, and raises its international profile.
For the Kurds, this arrangement solves multiple problems at once. They get protection from external threats while signaling to the world that they remain a reliable partner for Western powers. Meanwhile, Baghdad’s own decision to push out American forces makes it harder for the central government to criticize Kurdistan for welcoming them. The KRG can now claim it’s simply filling a void that Baghdad created.
The irony is sharp: Baghdad demanded the U.S. exit to show control, but in doing so it empowered the one region most determined to remain semi-autonomous. With U.S. troops now stationed in Erbil, Kurdistan gains not just a shield against the Islamic State and militias, but also political capital it can leverage in Iraq’s endless federal battles.
The Remaining Vacuum
The danger lies in what happens to the spaces the U.S. vacates. Central and southern Iraq are now more vulnerable than ever. The Islamic State no longer controls cities, but sleeper cells remain. In June 2025, Reuters reported that Islamic State fighters were reactivating networks and attempting ambushes in provinces like Diyala and Kirkuk. These are reminders that the group still has the capacity to disrupt daily life.
At the same time, Iran-backed militias are filling the void. They aren’t just waging violence; they’re embedding themselves politically. Parliament has recently advanced legislation to give the Popular Mobilization Forces (PMF) a more formal role in state security, a move that would entrench Tehran’s allies inside Iraq’s governing framework. For Iraqis living outside Kurdistan, withdrawal doesn’t look like sovereignty. It looks like abandonment: to militias, insurgents, and political factions whose loyalties lie eastward.
Here’s the uncomfortable truth: moving troops north doesn’t just protect Americans. It opens space for Tehran. With U.S. forces out of Iraq’s heartland, Iranian-backed militias are freer to expand influence in politics, security, and the economy. The economic side is especially revealing. A fuel-oil smuggling network tied to these groups generates roughly $1 billion annually, channeling resources directly to Iran and its proxies. That money buys weapons, secures patronage networks, and keeps Tehran’s hand firmly inside Iraq.
So, while Washington presents this as a “strategic drawdown,” the practical effect is different. Safety for U.S. soldiers comes at the price of influence over Iraq’s center and south. Visible empowerment goes to the Kurds. Invisible empowerment goes to Iran.
This isn’t unprecedented. After the 2011 withdrawal, the Islamic State filled the vacuum, seizing territory and plunging Iraq back into crisis. The parallels are striking. Then, as now, Iraqi forces were deemed “ready” to handle security independently. Then, as now, political divisions in Baghdad created opportunities for extremist groups. Then, as now, Iran-backed militias positioned themselves as the alternative to American influence.
Today’s landscape carries the same risks: exposed provinces, resurgent militants, and Iran-backed militias eager to consolidate gains. The United States may shield its personnel, but the long-term fallout could be another destabilizing cycle.
Who Really Wins?
Baghdad celebrates sovereignty. Washington claims victory. The Kurds gain leverage. And Iran, quietly, may be the biggest winner.
But the story does not end with declarations of victory. Iraq now faces two broad paths. One is domestic: militias aligned with Tehran tighten their grip on central and southern Iraq while Kurdistan, shielded by U.S. forces, presses for greater autonomy, pushing the country further toward fragmentation. The other is international: Washington adapts through diplomacy rather than direct military presence, investing in air defense, deepening ties with the Kurds, and leaning on regional partners to contain the fallout.
Neither outcome represents the sovereignty Baghdad claims. Instead, both show how the withdrawal redraws Iraq’s political map without truly stabilizing it. The real question is not whether U.S. troops leave but who fills the vacuum they leave behind. And right now, the answer looks less like Baghdad and far more like Erbil, and Tehran.