Iraq between oil and the dollar
The Iraqi oil crisis is no longer fundamentally a production crisis, but rather a crisis of access, cost, and marketing flexibility. The economic value of a barrel is not realized at the wellhead, but rather upon its arrival at the market and its conversion into actual revenue for the state. Hence, the Strait of Hormuz crisis has redefined the concept of energy security for Iraq, not only in terms of reserve size or production capacity, but also in the state's ability to guarantee exportability and maintain the highest possible net return per barrel.
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During September, Iraq's exports averaged around 2.6 million barrels per day, according to the Ministry of Oil, indicating a recovery of a significant portion of the flows after the declines imposed by the crisis. However, this was achieved within a high-risk and costly logistical environment.
The fundamental problem is that Iraq has a highly concentrated geographical area in its export system, with the majority of its exports relying on its southern ports and then transiting the Strait of Hormuz. When this maritime passage becomes a geopolitical chokepoint, the risks immediately extend to tanker rates, insurance, and crude oil pricing. The Iraqi oil minister stated that the cost of transporting Iraqi crude had risen from approximately $26 to $37 per barrel, while Saudi Arabia described regional shipping costs as having reached exceptional levels due to the war and disruptions to maritime navigation.
In response, the government, the Ministry of Oil, and the State Oil Marketing Company (SOMO) moved toward a more flexible management of Iraqi crude: expanding the buyer base, using price incentives to maintain market share, and leveraging the expanded ship-to-ship (STS) network in the Gulf of Oman to reduce the time large tankers are exposed to the risks of the Strait of Hormuz. The northern route was also revitalized, and a pilot program was launched to transport crude from the south to Kirkuk by truck to boost exports to Ceyhan. However, overland transport remains a limited-capacity tactical solution and cannot be economically comparable to large-capacity pipelines.
Most importantly, there are the economics of the barrel. ADNOC purchased large quantities of Iraqi crude during August and September at discounts ranging from approximately $18 to $27 per barrel in some deals. This flexibility helped market volumes that might otherwise have struggled to reach buyers, but it also means that increased export volumes do not necessarily translate into a proportional increase in revenue.
Here, a distinction must be made between three indicators: the global price of oil, the actual selling price of Iraqi crude, and the net return or "netback" after accounting for pricing differences, logistical costs, and risks. Brent crude may rise, but Iraq may not fully benefit from this increase if discounts widen and transportation and risk premiums rise.
This equation leads directly to the dollar. The selling price in Baghdad's exchange shops exceeded 160,000 dinars per 100 dollars on September 19, before declining to about 157,750 dinars by the close of trading on September 22.
Technically, the rise of the dollar cannot be automatically linked to the decline in oil exports. There is a difference between the flow of sovereign oil revenues and the supply of dollars in the local market. The central bank affirmed the adequacy of its foreign reserves to meet legitimate demand and attributed the rise in the parallel market to speculation, expectations, and geopolitical conditions. Nevertheless, the structural relationship remains clear: oil is the primary source of foreign currency and public finance, and therefore, the continued erosion of net revenue per barrel gradually reduces the financial margin available to the state.
The strategic lesson of the crisis is that Iraq needs to move from managing exports to building export security: multiple outlets, alternative pipelines, strategic storage, greater national capacity in maritime transport, and marketing flexibility that reduces the cost of risks.
The real measure is no longer how many barrels Iraq exports, but how many net dollars it retains from each barrel, and the extent to which this revenue can support the budget, reserves, and the stability of the dinar. Here, the oil file shifts from managing quantities to managing value and economic security.
The Ministerial Council for the Economy approves the draft 2027 budget and refers it to the government.
The Ministerial Council for the Economy approved on Sunday (September 27, 2026) the draft federal general budget law for the Republic of Iraq for the fiscal year 2027, officially passing the draft to the Council of Ministers.
According to a document issued by the Council, bearing the signature of the Deputy Chairman of the Ministerial Council for Economy and Minister of Finance, Faleh Sari, and received by “Baghdad Today”, “The Council was briefed in its twelfth session held on September 27, 2026, on the draft of the Federal Budget Law for 2027, which was presented as an emergency proposal in accordance with the letter from the Ministry of Finance.”
The document addressed to the Secretary-General of the Council of Ministers explained that the Council approved a recommendation bearing the wording “very urgent” which includes “referring the draft of the federal general budget law to the Council of Ministers, taking into consideration the observations of
the honorable members of the Council and kindly taking the necessary action and presenting it to the ministers.”
Iraq Advances 2027 Budget Bill to Ministerial Review
Iraq's Finance Ministry has completed the 2027 federal budget draft and sent it to the Ministerial Council for the Economy for review.
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Iraq's Ministry of Finance has completed preparations for the 2027 federal general budget bill and referred the draft to the Ministerial Council for the Economy, moving it into the next stage of government review.
The ministry said in a statement on Sunday, that the draft was sent to the council after the completion of the preparation process led by the Higher Committee for Budget Preparation.
Finance Minister Falah Sari supervised the committee's work, which included representatives from federal ministries, the Kurdistan Region and Iraq's provinces, as well as consultations with financial experts from inside and outside the country.
Sari said the Finance Ministry had fulfilled its responsibility to prepare the draft budget within the specified timeframe.
The proposed budget also introduces a gradual expansion of what the ministry described as a "program and performance budgeting" system, designed to connect government spending more closely with stated objectives and measurable results.
The system will initially be applied to the electricity sector and in the provinces of Diwaniyah and Salahaddin.
According to the ministry, the initial implementation is intended to prepare for a wider transition toward program-and-performance budgeting across state institutions.
The approach shifts part of the budget process toward evaluating how financial allocations relate to specific programs, goals and outcomes rather than focusing solely on expenditure categories.
The Finance Ministry said the 2027 draft also takes into account the priorities of the government program, changes in Iraq's economic and financial conditions, and the needs of different sections of society.
Those priorities are being considered within the limits of the state's available financial capacity, according to the statement.
The draft places particular emphasis on increasing non-oil revenues and strengthening fiscal discipline, two areas identified by the ministry as central to the government's budget planning.
Iraq's public finances have traditionally depended heavily on oil revenues, making efforts to expand alternative sources of state income an important component of the budget preparation process.
The ministry did not provide figures for projected expenditure, revenue or the fiscal deficit in the statement.
The budget is now expected to be discussed by the Ministerial Council for the Economy, which will examine the draft before it advances to the Iraqi Council of Ministers.
Following the council's review, the bill is expected to be referred to the cabinet for final government approval in accordance with established procedures.
The submission therefore marks the completion of the Finance Ministry's drafting stage while beginning the government-level review of spending priorities, revenue policy and the broader fiscal framework for 2027.
The dispute over "compliance"
Iraqi taxes remain unchanged... Accountants discuss a retroactive audit for three years
The Accountants and Auditors Syndicate in Baghdad witnessed an extensive dialogue seminar that brought together the senior staff of the General Authority for Taxes, headed by its director Haider Ali Hussein, and representatives of the Syndicate and the Association of Certified Public Accountants, to discuss the problems of inflated accounting amounts and the rejection of final accounts, in addition to the mechanism of “post-audit or compliance” which extends for three years retroactively, amid assurances of the stability of tax rates and Iraq’s readiness to apply international standards in a binding manner next year.
The head of the Accountants and Auditors Syndicate, Jawad Al-Shuhaili, told 964 Network that “Iraq will directly enter into the application of international standards in a binding manner during the coming year, which requires awareness and understanding from the accountant and auditor to prepare data in accordance with global levels.”
Al-Shuhaili explained that “the union has taken upon itself the task of training and qualifying staff, and has expressed its full readiness to train the employees of the General Authority for Taxes as well, in order to unify the mechanism for reading financial data and achieve harmony,” denying what is being rumored about an increase in tax rates, and stressing that “the rates set by the Authority are fixed, and the focus is on achieving high tax compliance and employing revenues in the interest of the country.”
In the same context, the head of the Iraqi Association of Accountants, Riya Abdul Amir Al-Karnawi, pointed out to 964 Network that “the discussions focused on the complexities of tax accounting for the accounting offices themselves, and for the final accounts of companies subject to the bookkeeping system.”
Abdul Amir continued, “Auditors have been suffering for years from decisions to reject final accounts and refer them to the compliance department or subject them to post-audit, which prompted the symposium to present a package of practical proposals and solutions that we are waiting to be officially adopted to end these disruptions.”
For his part, Ali Al-Fatlawi, a member of the board of directors of the Iraqi Association of Certified Public Accountants, told 964 Network that “the meeting focused on the obstacles that auditors face in their dealings with the Authority regarding the financial statements of companies and individuals.”
Al-Fatlawi explained that “the main problem lies in the subsequent audit or what is known as (compliance), as the entities whose data was approved are surprised by supervisory reviews that extend retroactively for three years, and this is a point of contention that needs in-depth discussion to come up with clear mechanisms that ensure the stability of accounting work.”
Deputy: Trump administration lifts veto on nominee for Iraqi deputy prime minister
On Sunday, MP Abu Turab al-Tamimi revealed that Prime Minister Ali al-Zaidi had received American "blessings" to appoint one of the figures as his deputy,
while he criticized the Iraqi government's response to the flight ban with Iran, stressing that it was a decision contrary to international laws.
Al-Tamimi told Shafaq News Agency, “During his meetings with the US administration during his recent visit to the United States, the Prime Minister obtained approval to name one of the candidates for the position of Deputy Prime Minister, even though this candidate had an American objection or veto preventing his appointment to this position. However, according to the information received, the veto was lifted from him based on guarantees made by Al-Zaidi . ”
Regarding the completion of the cabinet, Al-Tamimi explained that this issue will be resolved after the withdrawal of US forces from the country.
He pointed out that the State of Law coalition, led by Nouri al-Maliki, "is still holding on to its candidate, Qasim Atta, for the position of Minister of the Interior, and we support Atta's nomination for the position . "
Regarding the ban on Iranian flights, the MP criticized the decision and considered it “contrary to international regulations and agreements related to flight bans, since a ban or prohibition can only be imposed by a United Nations resolution to ban civil and military flights or by the International Civil Aviation Organization (ICAO), otherwise it is a clear violation . ”
The International Civil Aviation Organization (ICAO) is a United Nations agency that helps 193 countries cooperate with each other and share their airspace for mutual benefit .
The Iraqi government issued a decision last week banning flights from Iraqi airports to Iran or receiving Iranian flights, in response to sanctions announced by the US Treasury Department on September 8 against 36 entities linked to the Iranian aviation sector, including 27 airlines.
The positions of travel, tourism and land transport companies in Iraq varied regarding the US sanctions imposed on Iranian airlines, which came into effect last Wednesday.
The Iraqi government announced on Saturday that it would hold direct talks with the US administration to exempt some Iraqi airports from the ban on Iranian flights.
Earlier today, a well-informed political source revealed that the leaders of the Coordination Framework will hold a meeting this evening, Sunday, in the presence of Prime Minister Ali al-Zubaidi, to discuss the decision to ban Iranian aircraft from landing at all Iraqi airports, as well as to discuss the internal political and popular repercussions of the decision.
Today, the Iraqi government also received a serious and direct American warning against continuing to receive any Iranian airline at Iraqi airports, stressing that continuing to receive the planes exposes the airport and the entities and companies that provide services for these flights to American sanctions.
An informed source told Shafaq News Agency that "the American side clarified to the Iraqi government that the punitive measures will not be limited to the Iranian airlines covered by the sanctions, but may extend to any entity or airport that provides services or facilitates the operation of those companies' flights, including landing services, ground handling, refueling and other services related to the flights."
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Iraq declares "Sovereignty Day" holiday from Wednesday to Sunday
On Saturday, the Cabinet issued a decision to suspend official working hours on the occasion of "Sovereignty Day".
An official statement from the media office of Prime Minister Ali al-Zaidi stated: It has been decided to suspend official working hours in state institutions starting from Wednesday, September 30, until Saturday, October 3, in celebration of the (Sovereignty Days) of the Republic of Iraq.
The complete withdrawal of foreign forces from Iraq is expected to be announced on September 30, after all their bases and camps have been handed over to the Iraqi side.
Al-Zaydi had previously directed all ministries, non-ministerial entities, and governorates to take the necessary measures in accordance with the law, in coordination with the government media cell, regarding the celebration of "Iraqi Sovereignty Day".
Iraq and the United States had agreed in September 2024 to end the military mission of the international coalition led by Washington against the "Islamic State" organization in Iraq, as part of a phased plan to move the security relationship between the two countries from the framework of the coalition to a bilateral partnership.
The first phase of the mission ended in September 2025, while forces remained in the Kurdistan Region to support operations against the organization in Syria, with the final phase to be completed by the end of September 2026.
The international coalition was formed in 2014 to assist Iraqi forces in confronting ISIS, which at the time controlled large areas of Iraq and Syria. The mission of the coalition forces later shifted primarily to training, advising, and intelligence support, while Baghdad asserts that its forces are now capable of assuming
responsibility for security and pursuing the organization's cells.
Continuing from previous discussions
Fuad Hussein arrives in Washington: We want a political and security partnership and we will discuss this in the most important think tanks.
Foreign Minister Fuad Hussein announced on Sunday (September 27, 2026) his arrival in Washington, D.C., to hold meetings with the U.S. administration, with the aim of moving the two countries’ relations towards a broader partnership based on developing political, security and economic cooperation, noting that the discussions that will bring the two countries together will be in the most important think tanks in the U.S. capital.
Full US Withdrawal from Iraq: Official Reveals Completion of Operation
An Iraqi government official announced on Sunday the completion of the US troop withdrawal from Iraq, noting that all combat and logistical support forces have left the country.
The official told the German Press Agency (DPA) that the withdrawal process is fully complete, although there has been no official confirmation from the US side yet.
Iraq and the United States had agreed on a timeline to end the US military presence in the country. According to the US Department of Defense, approximately 2,500 US troops had been stationed in Iraq in recent years.
Prior to the withdrawal, US forces were deployed across Erbil in the Kurdistan Region, a base near Baghdad Airport, and locations within the capital's Green Zone.
US forces had returned to Iraq in 2014—at the request of the Iraqi government and as part of the international coalition to combat ISIS—three years after their withdrawal following the 2003 US invasion of the country.
Starlink's license is official and legal in Iraq. The Media Commission: We have full control over the data and deny its presence in Qatar.
About the news
- Starlink license becomes official in Iraq.
- The Media Authority confirms the legality of the service and categorically denies that its data is located in Qatar.
- Abu Kalal reveals details of Starlink launch: We were delayed due to security vetting.
The Media and Communications Commission announced on Sunday that Starlink's license has become official, confirming that working with its services is legal in Iraq, with full control over data, and denying the validity of claims about its presence in Qatar.
- It guarantees Iraq's full sovereignty over the data.
- Access gateways will be installed inside Iraq soon.
The head of the executive body of the authority, Baligh Abu Kalal, said in a statement to the official agency that “the Starlink license has become official and working with it is legal in Iraq and there are requests to subscribe on the company’s website.”
- The first subscription meal has been launched.
- Delivery of meals to citizens who have ordered Starlink devices will continue.
- Our agencies have detailed information about the devices in operation and who owns them.
- We have a connection with Starlink to find out about devices operating in Iraq.
The head of the executive body of the authority affirmed that "the company is committed to the authority, and we have an advanced security system that is a source of pride in Iraq. What is being raised regarding the presence of Iraqi data in Qatar is inaccurate, and we have complete control over the data."
- The company wanted to open access gateways in Iraq after two years.
- Due to the increasing demand in Iraq, we have now begun negotiating with them to start installing access gateways.
He pointed out that "the control of satellite internet does not stop at access gateways, because it is broadcast in space, which is an increase in reassurance. The basis for controlling satellite internet is regulation, licensing, the company's commitment to the state, and the imposition of state sovereignty."
If our viewers would like more discussion, joining us is the President of the Iraq Energy Center, Dr. Furat Al-Mousawi. Welcome to the main bulletin. Let’s start with the situation…0:09
…of referring the 2027 budget to the Council of Ministers relatively early. Does this step reflect the government’s desire…0:17
…to end the annual crisis of delayed budget approval, or will the crisis actually begin after it is sent to the Council of Representatives?0:26
Good evening to you and to your distinguished viewers. Of course, the 2027 budget faces many unprecedented local, regional, and global challenges. We have always relied on the budget because our economy is a rentier one, so the budget depends on the price of a barrel of oil and on export outlets. Export outlets have now become a very clear fiscal policy. That’s one side.0:51
On the other side, as a result of the current regional and local challenges — because of the tensions in Hormuz — what is known as a programs-and-performance budget has emerged. The Ministry of Finance truly wanted to cut short any delay in approving the budget…1:17
…so that the state can continue with upcoming projects and the items it included in this budget. It does not want any delay. The government is also fully prepared to study this budget, send it to parliament, and then have it approved so that things proceed smoothly without problems, despite the major challenges.1:40
Doctor, part of these challenges — and we welcome you again on this main bulletin — is that previous budgets were all drawn up according to a possible oil export price and regional conditions that might allow that. But under these circumstances, how were the percentages in this budget calculated with precision, given its challenges? There are also promises to convert some daily-wage contracts into permanent positions. How will that be handled while we face this financial crisis? And also the Kurdistan Region’s share in it?
Of course, there are still items that represent the biggest challenges, including the Region’s budget, the governorates’ budgets, and also the budget for designated projects such as the Ministry of Electricity according to the performance and programs in place. The price of a barrel of oil is truly the main governing factor in this budget.2:43
At the beginning, those meeting assumed the oil price would range between $60 and $70 a barrel. But that price proved overly optimistic and not conservative. Therefore it was reduced to around $50–53 a barrel. That is the price that can sustain the budget with production or exports of about 3.5 million barrels of oil. Of course this is the largest share; it could still be reduced further. It will also be discussed inside the Council of Representatives, and we will follow it with you.3:23
Dr. Furat Al-Mousawi, President of the Iraq Energy Center — thank you very much. We will certainly follow this with you in our upcoming bulletins.
