KRG Aid Cut Risk: US Plans to End Security Assistance

## Catalyst Analysis: US Plans to Cut Military Aid to $KRG+WL

The U.S. Department of Defense has informed leaders of Iraq's semi-autonomous Kurdistan region that it does not intend to renew an expiring security assistance agreement. This aid, crucial for the Peshmerga security force, is provided through a memorandum of understanding that concludes on September 30. The Pentagon had previously proposed eliminating this security aid in its fiscal year 2027 budget request, citing the defeat of the Islamic State group, though this plan is currently on hold amid broader budget discussions in Congress.

## Impact on Kurdish Regional Government ($KRG+WL)

### Winners, Losers & Uncertainty

The potential cessation of U.S. military aid to the Peshmerga, which received $61 million in fiscal year 2026 for training, weapons, and stipends, is causing concern among Kurdish officials. They fear this action will create a power vacuum, potentially emboldening Iran and its associated militias, which have conducted numerous missile and drone attacks into Iraqi Kurdistan. Analysts suggest that ending this assistance could undermine a long-standing partner and damage U.S. credibility among its allies in the region.

### Risk Watch — legal/timeline; no fake EPS tables

The current memorandum of understanding between the Pentagon and the $KRG+WL expires on September 30, coinciding with the planned withdrawal of remaining U.S. troops from Iraq. This timeline marks the formal end of the international military campaign against ISIS in the region. The decision not to renew the security assistance agreement has raised alarms, particularly given the escalating attacks from Iran into Iraqi Kurdistan.