Iraq balanced gains and losses from the Iran-Israel conflict

 The recent 12-day conflict between Iran and Israel had a dual economic impact on Iraq, leaving the country at a neutral point between gains and losses, Mudhhir Mohammed Saleh, the financial and economic adviser to the Iraqi government, stated on Thursday. 

Describing the war’s impact as a “double-edged shock” to the national economy, Saledh noted that on the positive side, oil prices saw a short-term premium of 6 to 7 percent per barrel, benefiting Iraq’s revenues without disrupting exports.

“This price premium generated an estimated $150 to $160 million in additional revenues over a short period,” Saleh told Shafaq News, assuming a daily export volume of 3.3 million barrels. “Exports continued uninterrupted despite threats of Gulf closures.”

However, Saleh pointed out that Iraq also faced significant negative economic effects. These included higher import costs due to disruptions in maritime insurance markets, global price fluctuations, increased shipping expenses, losses in air transport, supply chain delays, forgone airspace transit fees, and a sharp decline in religious tourism during the conflict.

“The indirect losses roughly equaled the additional oil revenue,” he said, “leaving the Iraqi economy in a state of neutral uncertainty — neither a clear profit nor a net financial loss.”

He cautioned against relying on such temporary windfalls when shaping long-term policy. “This kind of wartime profit cannot support sustainable economic planning,” Saleh said, urging the government to establish a sovereign emergency fund to absorb future shocks and reduce pressure on public spending.

He also recommended developing at least four independent oil export routes to bolster economic resilience.