U.S. Department of State Spokesperson Tammy Bruce told reporters on Tuesday that the United States continues to urge Baghdad and Erbil to resolve their issues through constructive dialogue.

“That has not changed. We still want that. Resolving this salaries issue sends a signal that Iraq is creating an environment in which U.S. companies would want to invest. That I think is even more heightened now than ever before with the potential.

“A successful resolution would also send a positive signal on broader cooperation for the benefit of all Iraqis, such as the reopening of the Iraq-Turkey pipeline and additional energy exploration, including with U.S. companies. 

“I know that President Donald Trump’s vision of a peaceful world is one where everything is possible. Iraq fits into that, obviously, as do the Kurdish people. Nothing is impossible, and we’ve got the leadership that I think can take us there.”

Over the last few days there have been discussions between Baghdad and Erbil to resume the Kurdistan Region’s halted oil exports via the State Organization for Marketing of Oil, suspended since 2023 after an international arbitration ruling, alongside discussions on releasing May and June salaries for public employees, after Iraq’s Ministry of Finance suspended salaries to KRG employees for this year in May.

On Tuesday, Iraqi Prime Minister Mohammed Shia’ al-Sudani formed a committee to review two papers, one submitted by the Iraqi government and one by the Kurdistan Regional Government to find a solution.

“The committee will submit its recommendations to the Council of Ministers for appropriate action to be taken as soon as possible,” the Iraqi Prime Minister’s Media Office said.