The Iraqi oil trap and its paradox: A rentier economy amidst geopolitical shocks

Image
In an economy dependent on oil exports, and with the disruption of crude oil tanker traffic through the Strait of Hormuz due to the US-Iranian war, the core of the problem lies not only in the volume of exports and the revenues generated from them, but also in how these revenues are managed, and in the amount of spending that depletes them. On September 22, 2026, Iraqi Prime Minister Ali Zaidi told The New York Times that Iraq had lost nearly $60 billion in oil revenue due to the war with Iran. For approximately two months, Iraq was unable to export 90% of its oil, while 90% of its economy depended on crude oil exports. Before June 2025, when the first round of the US-Israeli conflict with Iran erupted, the Central Bank of Iraq’s reserves had exceeded $110 billion, but by October 2026 they had fallen to less than $60 billion. Although Zaidi’s government managed to balance global polarization and geopolitical tensions during its first five months in office, the biggest problem was the i...
Post a Comment

Disclaimer

Disclaimer

The information, news, opinions, and analyses published on Kurdish Policy Analysis are provided solely for informational and educational purposes. While every effort is made to ensure the accuracy, reliability, and timeliness of the content, no guarantee is made that all information is complete, current, or free from errors. The views expressed in articles and analysis are based on the author's independent research, interpretation, and professional judgment and should not be considered legal, financial, investment, or policy advice. Readers should independently verify information before making decisions based on the content of this website. Kurdish Policy Analysis is not responsible for any loss, damage, or consequences arising from the use of or reliance on the information provided. References to third-party websites or external sources are provided for informational purposes only and do not constitute endorsement of their content, products, services, or opinions.

This platform provides geopolitical analysis focused on Iraq and Kurdistan based on public reporting and regional developments. We distinguish between verified reporting, sourced briefings, and analytical interpretation.

  • Some content is based on open-source reporting
  • No claim of classified information authenticity

  • Analytical content is interpretive
  • The articles are for informational purposes only.
  •  I do not provide professional legal, financial, or political advice.
  •  I am not responsible for decisions readers make based on the content. 
  • External links are not under my control

    • Comments

    Post a Comment

    Popular posts from this blog

    The Development Road: Iraq's emerging geopolitical position between Türkiye, Iran, the Gulf and the Kurdistan Region

    Image
    Iraq’s Development Road faces political, security and regional challenges involving Kurdistan, Türkiye, Iran and Baghdad’s state capacity. The Development Road is not simply as an infrastructure or trade project, but  a geopolitical corridor whose success depends on unresolved Kurdish, Turkish, Syrian and Iranian dynamics. One can identify three Kurdish-related issues as particularly important to the corridor's political viability: Baghdad–Erbil disagreement over the northern route through the Kurdistan Region. The Türkiye–PKK peace process and its implications for northern Iraq. The future status and integration of the Kurdish-led SDF in Syria. In this article I also examine Iran's position, arguing that Tehran has so far avoided outright opposition partly because Iraq presents the project as potentially compatible with Iranian connectivity through the Basra–Shalamcheh rail link. Iraq and Türkiye completed a framework draft agreement on transport infrastructure on September 21...
    Read more

    Iran-Aligned Militias Threaten Iraqi Airports Over Suspended Iran Flights

    Image
    Iran-aligned militias threaten Iraqi airports over suspended Iran flights, raising aviation security risks and tensions with Washington. As flights between Iraq and Iran, including those to and from Najaf International Airport, come to a halt amid U.S. sanctions on Iran's aviation industry, Iran-aligned militias are leading the loyalist camp's rejection of the suspension. DEVELOPMENT Borderline Advisory Services has reported that At 2100 local time on 25 September, Akram al-Ka'abi, Secretary-General of Harakat al-Nujaba (HAN), issued a statement threatening to mobilize supporters for sit-ins at Iraqi airports unless the suspension is lifted. Ka'abi also called for breaking U.S. hegemony and rebuked the governing parties for acquiescing to Washington's demands. Earlier, at 1830 local time, Kata'ib Hezbollah (KH) said that any ground handling company complying with the U.S. decision "has chosen for itself the role of a submissive backer of the U.S. and Zionis...
    Read more

    The Kurdish Referendum: Between Defeat and Achievement

    Image
      Nine years after Kurdistan’s 2017 referendum, its political, economic and strategic consequences remain deeply contested. Nine years after the Kurdistan Region’s independence referendum, debate over the referendum and its consequences for the Kurdistan Region continues. Supporters regard it as a historic achievement, while its opponents see it as a factor that weakened the Region’s position within the framework of Iraq. On September 25, 2017, the referendum process was held in the Kurdistan Region and the disputed territories. At the time, the authorities of the Kurdistan Region claimed that the process was intended to pave the way for “independence” and “separation” from Iraq. However, less than a month later, the political balance shifted dramatically against the Region. When the referendum was held in the Kurdistan Region, most political parties and factions supported the process. However, less than a month later, when the Iraqi military operation against the disputed territor...
    Read more