Iran Suspends Baghdad and Muscat Flights Before New U.S. Sanctions

Iran has canceled flights from Tehran to Baghdad and Muscat starting at midnight Wednesday, the first suspensions before expanded U.S. aviation sanctions take effect September 23, 2026.

Tasnim News Agency reported the cancellations before the deadline, according to Al Jazeera. Other reporting described the Baghdad and Muscat suspensions as the first Iranian cancellations before the expanded sanctions.

Iraq ordered its civil aviation authority to suspend Iranian flights to Baghdad airport starting Wednesday after a U.S. sanctions threat, Reuters reported September 22, citing sources. The order covers Baghdad airport. It does not extend to other Iraqi airports.

U.S. Treasury Secretary Scott Bessent said September 21 that all Iranian airlines would be shut down on September 23 through secondary sanctions on aviation service providers. He told CNBC that when Iranian carriers land, providers cannot offer fuel, landing services, or ticket sales or they will lose access to the dollar system.

Secondary sanctions punish foreign firms that do business with a sanctioned target. Here, foreign airports, ground handlers, fuel suppliers, and ticket agents could lose dollar-system access if they serve designated Iranian carriers. Think of dollar access as the main payment road for world trade; being cut off closes that road. That means pressure falls less on Iranian operators and more on foreign providers weighing their exposure. The Treasury action was previewed in a press release titled "Treasury Grounds Iranian Airlines with Sweeping Sanctions Action," published by the U.S. Treasury. It builds on the August 24, 2026 aviation sector determination under Executive Order 13902. It targets Iran's remaining active airlines and adds to earlier sanctions against Iran's Mahan Air.

Iran's Civil Aviation Organization spokesman said September 22 the agency is negotiating to shift Baghdad-bound flights to Najaf Airport in Iraq. Iran's ISNA news agency reported September 22 that talks with Oman were still underway. ISNA also reported that all remaining Iranian international flights, including those to Istanbul, will operate as scheduled.

Baghdad is suspended. Najaf is proposed as an alternate. Muscat is suspended pending talks with Oman. Istanbul continues.

The broader context here is enforcement through third parties. Washington is not grounding aircraft itself. It is raising the cost of servicing them until most providers refuse. Baghdad's early action shows regulators were already adjusting before the sanctions took legal effect.

In my view, the next variables to watch are Najaf, Muscat, and Istanbul. If Najaf accepts redirected flights, it will test whether Washington applies the same risk to other Iraqi airports. If Oman reaches an accommodation, it will show how Gulf intermediaries balance U.S. financial pressure with air ties to Iran. If Istanbul service continues past September 23, it will show the limits of early compliance and where pressure may focus next. For operators, passengers, and regulators, the schedule after midnight is now a compliance signal.