Since the five were seized in a January 11th raid in Arbil, Iran has continued to press for their release amid claims that US secretary of state Condoleezza Rice's request for them to be freed has been overruled. However an early release may have implied a deal with the freeing of the 15 British sailors held by Iran, Washington officials have suggested.
The five Iranians will now be held for at least a few more weeks and, like the more than 250 foreign detainees held in Iraq, remain in custody through a periodic six-month review by US officials. It is thought that the next review is expected in July.
The decision came as Iraq's government spokesperson, Ali Dabbagh, called for better relations between Tehran and Washington while on a visit to the White House.
"We feel that the improvement and the better relations between the United States and Iran could minimise - could make the [Iranian] interference less," the Washington Post cited Mr Dabbagh as saying.
Click here to run an energy price comparison, and see if you could be paying less for your gas and electricity.