Oil supplies 88 per cent of Iraq's government revenue and 91 per cent of its merchandise exports

Background

The dependence behind Iraq's devaluation and its budget trouble is set out by the World Bank. On its estimates, oil accounts for about 53 per cent of Iraq's real GDP in 2025, 88 per cent of government revenues and 91 per cent of merchandise exports. GDP fell 2.4 per cent year-on-year over the first nine months of 2025, with oil GDP contracting 5.7 per cent as OPEC+ production limits constrained output, while non-oil GDP growth slowed to 1.5 per cent, held back by water and electricity shortages and a liquidity crunch caused by falling oil revenues. Unemployment stands at 13.5 per cent and labour force participation at 38 per cent, and youth aged 15 to 29 make up nearly 29 per cent of the population. The Bank lists Iraq as vulnerable to rising temperatures, water scarcity and extreme weather.