Iraq’s oil sales hammered by Strait of Hormuz crisis as revenues collapse 84%

Iraq’s Prime Minister confirmed what the numbers have been screaming for months: the country’s oil sales have taken a devastating hit from the US-Iran crisis choking the Strait of Hormuz. For a nation that derives roughly 90% of its government revenue from crude exports, that’s not just bad news. It’s an existential fiscal problem. Iraq’s oil production cratered from an average of 4.3 million barrels per day before the conflict to approximately 1.4 million bpd after the strait’s disruption began. Monthly oil revenue followed the same cliff dive, dropping from $6.8 billion in February 2026 to just $1.1 billion by April. That 84% revenue collapse has forced Baghdad into a financial firefight on multiple fronts. The chokepoint that broke Iraq’s budget The Strait of Hormuz is the narrow waterway separating Iran from the Arabian Peninsula, and roughly 20% of global oil supply passes through it on any given day. When the US-Iran conflict escalated on February 28, 2026, tanker traffic through the strait faced closures and severe restrictions. Iraq, despite sharing no coastline with the strait itself, routes a significant portion of its southern crude exports through those waters. The resu...