Smugglers in Iraq Blunt Sanctions Against Iran

Photo: Ayman Oghanna for The New York Times.

PENJWIN, Iraq — Even as the United States imposes new sanctions on Iran, one of the biggest gaps in the American strategy is on full display here in Iraq, where hundreds of millions of dollars in crude oil and refined products are smuggled over the scenic mountains of Iraqi Kurdistan every year.

Day after day, without formal authorization from Baghdad, more than a thousand tankers snake through this town on Iraq’s border with Iran, not only undercutting recent American sanctions but also worsening tensions with the Iraqi government over how to divide the country’s oil profits.

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