Iraq has lost approximately $60 billion following the outbreak of war in the Middle East and a sharp decline in oil revenues caused by disruptions to shipping through the Strait of Hormuz.
According to the Iraqi News Agency (INA), Foreign Minister Fuad Hussein made the statement during a meeting with his Italian counterpart in Rome on Thursday.
Hussein said Iraq’s economic crisis had deepened since the war broke out in the region in February. Oil exports, which account for approximately 90% of the country’s revenue, declined sharply over several months. As a result, the government was forced to resort to domestic borrowing, consumer prices increased, and the country’s foreign exchange reserves fell by around $20 billion.
Before the war, Iraq, an OPEC member, produced approximately 4 million barrels of oil per day, exporting nearly 3.5 million barrels, mainly from its southern oil fields through the Strait of Hormuz. However, restrictions on shipping through the waterway following the outbreak of war have severely affected Iraq’s oil exports.
With storage facilities reaching capacity, the country was forced to suspend production at several oil fields. Iraq subsequently began exporting limited quantities of oil to Syria by tanker and to Türkiye via pipeline.
According to Iraq’s Ministry of Oil, export volumes have partially recovered in recent months, reaching 2.6 million barrels per day between September 1 and 21.
The International Monetary Fund (IMF) also said this week that Iraq was among the countries hardest hit by disruptions to transport routes caused by the war.
Amid the deepening economic crisis, the Central Bank of Iraq raised the official exchange rate of the US dollar last week for the first time in more than three years.