Financial expert: The collapse in oil prices threatens Iraq’s budget and requires diversifying the economy.
Financial expert: The collapse in oil prices threatens Iraq’s budget and requires diversifying the economy.
4-15-2025
Al-Maalouma/Baghdad..
Financial and banking researcher Mustafa Hantoush confirmed on Tuesday that Iraq has been directly affected by US tariffs, as it has imports estimated at nearly two billion dollars, warning of wider economic repercussions in light of the disruptions in global supply chains.
Hantoush told Al-Maalouma Agency, “There are fears that supply chains are beginning to be threatened, which could lead to a decline in production, layoffs, and a decrease in spending and travel, which would negatively impact oil prices.” He pointed out that “Iraq’s heavy dependence on oil, which constitutes 90% of its budget, makes it vulnerable to significant impacts if prices continue to decline.”
He explained that “oil prices have collapsed to around $60 per barrel, while Iraq’s budget is calculated at $70 per barrel, which poses a real threat to the country’s financial stability.”
He pointed out that “confronting this threat requires a balance in the international equation, which is not an easy task. However, the United States will not accept oil prices falling below $60, and may intervene to restore the balance, which may be in Iraq’s interest.”
He stressed the need for “Iraq to seriously consider diversifying its economy during the next phase, by supporting the private sector, establishing industrial cities, and expanding the road network and markets,” noting that “Iraq has millions of acres of arable land that can contribute to achieving food security and increasing revenues, in addition to activating the path to development.”
He pointed out that “the most important step now is to work to collect revenues from multiple sources, and not to continue to rely almost entirely on oil as the sole source of the general budget.”
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