Economic Fallout: Foreign Minister Fuad Hussein says Iraq lost about $60 billion in the U.S.-Iran war as disruption to the Strait of Hormuz slashed oil exports. Oil provides roughly 90% of government revenue, and reserves have also fallen. Bank Sanctions: The U.S. sanctioned Iraq’s International Development Bank over alleged links to Iranian financial networks. The bank denies the accusations and says it is working with Iraqi regulators to protect customers and maintain permitted services. Cabinet Completed: Parliament approved 11 ministers and three deputy prime ministers, filling posts vacant since May. The appointment of Laith al-Khazali, a U.S.-sanctioned figure, drew scrutiny; diplomatic sources say Washington gave tacit approval after receiving assurances on militia disarmament. The Iraqi Communist Party condemned the lineup as another power-sharing deal. OIC Meeting: Baghdad hosts the OIC foreign ministers’ meeting on Oct. 17–18, when Türkiye is set to hand the rotating presidency to Iraq. The agenda includes Gaza and regional conflicts.
AGP Executive Report
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Government Formation: Parliament approved 11 ministers and three deputy prime ministers, completing most of Prime Minister Ali al-Zaidi’s cabinet after months of vacancies. The Migration Ministry remains unfilled, and the appointment of US-sanctioned Asaib Ahl al-Haq figure Laith al-Khazali as deputy prime minister could complicate ties with Washington. Economic Pressure: Iraq’s dinar devaluation is raising costs for services and travel, while lawmakers warn the new exchange rate is squeezing traders and households. The Central Bank will let eligible travelers access a $2,000 currency allocation every two months. US Sanctions: Washington sanctioned Iraq’s International Development Bank, accusing it of helping Iran access dollars and maintaining ties to Iranian entities and armed groups. Regional Links: Iraq and Kuwait reopened air routes after a temporary security-related suspension. Baghdad has also pledged that Iraqi territory will not be used for attacks on Saudi Arabia. Radioactive Cleanup: Iraq says it has controlled all identified radioactive contamination sites and is removing remaining hazardous materials, with officials hopeful the country can soon be declared contamination-free.
Currency and Markets: The dollar closed at 166,550 dinars per $100 in Baghdad as traders grapple with Iraq’s recent devaluation and near-empty markets. Reports of counterfeit 25,000-dinar notes have added to concerns, prompting calls for stricter checks. Government Formation: The KDP named candidates for deputy prime minister and housing minister ahead of parliament’s cabinet vote, while a journalists’ group condemned parliament’s decision to bar media from the session. Regional Security: Iraq and Saudi Arabia agreed to tighten border coordination. Prime Minister Ali al-Zaidi again said Iraqi territory would not be used to launch attacks on Saudi Arabia or other regional countries. Oil: BP’s joint operating body took over Kirkuk’s four main oilfields, targeting output of 450,000 barrels a day and expanded gas capture. Education: The government says it will seek funding to replace Iraq’s mud-brick and caravan schools, amid a shortage of more than 10,000 schools nationwide.
Iraq–Saudi Ties: In Riyadh, Prime Minister Ali al-Zaidi told Crown Prince Mohammed bin Salman that Iraq would not let its territory be used to attack Saudi Arabia or other regional states. He condemned strikes on Saudi civilian infrastructure as the two leaders discussed security cooperation. Security: Two Iraqi military personnel were killed and three wounded when an ISIS-planted bomb exploded during an operation in Kirkuk, after Iraqi airstrikes targeted militant hideouts. Food and Water: Iraq’s Agriculture Ministry says annual egg production falls 3 billion short of demand, with supply disruptions and exchange-rate swings pushing up prices. Officials also clarified that HIV cannot spread through fish or water, amid concerns over river pollution and untreated hospital waste. Economy: Oil revenues fell 53% in the first seven months of 2026, widening pressure on public finances. The government has eased food import rules and waived duties on food and medicines following the dinar devaluation. Militia Disarmament: Iran-backed factions say they have conditionally agreed to place their weapons under state control, but negotiations and implementation remain subject to Baghdad and Washington meeting their commitments.
Saudi Ties: Prime Minister Ali al-Zaidi told Crown Prince Mohammed bin Salman in Riyadh that Iraq would not allow its territory to be used for attacks on Saudi Arabia or other regional states. The leaders discussed security coordination amid heightened Gulf tensions. ISIS Threat: Two Iraqi military personnel, including a brigadier general, were killed and two others wounded when an ISIS explosive device detonated in Kirkuk as they inspected a site hit by an airstrike. Cabinet: Parliament is set to vote Thursday on filling vacant ministerial posts and completing al-Zaidi’s government after months of negotiations. Economic Strain: The dollar rose to 167,000 dinars per $100 in Baghdad and Erbil, while the IMF projects Iraq’s economy will contract 16% this year. The government waived customs duties on food and medicines to ease price pressures. Economic Reform: Finance Minister Falih al-Sari said Iraq’s Vision 2050 aims to reduce dependence on oil and expand the private sector.
Security: Iraqi F-16s struck ISIS hideouts in Kirkuk, killing at least two militants, as Baghdad reported 74 people detained for illegal border crossings in September. Iraqi Resistance groups also accused US aircraft of violating Iraqi airspace days after the coalition mission ended. Government: Parliament is set to vote Thursday on filling vacant cabinet posts, while postgraduate degree holders and top graduates began an open-ended sit-in in Baghdad demanding jobs. Economy: The IMF expects Iraq’s economy to contract 16% this year. Government advisers say fuel and basic services subsidies will remain in place to cushion households after the dinar’s devaluation. Regional ties: Prime Minister Ali al-Zaidi is due in Saudi Arabia to discuss stronger economic and security cooperation, with a visit to Kuwait also planned.
Federal-Kurdish Tensions: Iraq’s Federal Supreme Court struck down a Kurdistan Region law suspending parts of the national penal code on state-security crimes, ruling it unconstitutional and binding on all authorities. Dinar Pressure: The Central Bank raised overseas card-purchase limits but capped monthly spending at five million dinars. It also said traders with import transfers confirmed before Oct. 7 won’t owe the difference under the new exchange rate. Economic Shock: The IMF forecasts Iraq’s economy will shrink 16% this year before rebounding in 2027, with inflation and the current-account deficit set to rise. Post-Coalition Security: Officials say Iraqi forces lack coalition-grade surveillance technology and ISIS remains active after the US-led mission ended, though intelligence-sharing continues. Power and Gas: Kurdistan’s 24-hour Runaki electricity scheme is expected to cover the region by year-end; officials say gas output could triple, but electricity costs exceed revenues. Washington Ties: US envoy Tom Barrack’s meetings with Iraq’s prime minister and top judge signal a shift toward economic and judicial cooperation after the troop withdrawal.
Cabinet Talks: Political blocs agreed to hold a parliamentary vote Thursday on nine vacant ministerial posts and a proposal for four deputy prime ministers. The talks come as Iraq weighs new ministries alongside agency mergers and spending cuts. Economy: The dinar’s devaluation is raising import costs, squeezing household budgets and making repairs harder to afford. Energy and Investment: Prime Minister Ali al-Zaidi met TotalEnergies and ConocoPhillips executives to discuss boosting oil and associated-gas production in Basra. He also invited international firms to develop and manage Mosul airport. Security: Iraqi jets struck a Daesh position in the east as Iraq assumes more counterterrorism duties following the coalition’s mission end. The PKK has also withdrawn from four camps in northern Iraq as part of its peace process with Türkiye. Regional Ties: US envoy Tom Barrack said Washington wants broader economic cooperation with Baghdad; Iraq and Saudi Arabia also discussed energy ties. Detention Case: Australian engineer Robert Pether has left Iraq and reunited with his family in Ireland after more than five years of detention and travel restrictions.
Kurdistan Security: Iran struck a camp used by Iranian Kurdish opposition fighters near Koya, causing damage but no reported casualties. The attack comes amid Kurdish concerns about security after the US-led coalition mission in Iraq ended. Turkey–PKK Peace Process: Turkey says PKK militants have withdrawn from four camps in northern Iraq, a step toward the group’s planned disbandment. Counter-ISIS: Iraqi F-16s destroyed an ISIS position in Diyala as Baghdad steps up operations against remaining cells. Baghdad–KRG Ties: Masrour Barzani and former premier Mohammed Shia al-Sudani discussed federal-regional cooperation; Barzani also called for a fair Kurdistan share of the 2027 budget. Oil and Revenue: Two new Nasiriyah wells lifted output by 10,000 barrels a day, while September customs revenue rose 32% year on year to 442 billion dinars. Investment: Iraq invited international firms to develop and operate Mosul airport. Diplomacy and Detention: Baghdad named Ahmed Nayef al-Dulaimi ambassador to Saudi Arabia ahead of Prime Minister Ali al-Zaidi’s Gulf tour. Australian engineer Robert Pether has left Iraq for Ireland after a court lifted his travel ban and dismissed proceedings against him.
Consular Affairs: Australian engineer Robert Pether has left Iraq after more than five years in detention; he was arrested in Baghdad in 2021 while working on the Central Bank’s new headquarters. Energy: Prime Minister Ali al-Zaidi discussed boosting oil and gas production at Basra’s Ibn Umar field with TotalEnergies and ConocoPhillips, as his government seeks to end gas imports. Ahead of al-Zaidi’s Gulf tour, Iraq is also preparing talks with Saudi Arabia on reviving a pipeline to Yanbu as an alternative export route. Currency: A lawmaker has challenged the government’s dollar-rate increase in federal court. The public rate is now 1,520 dinars per dollar, amid concerns over price rises and the budget. Environment: Nearly six million cubic meters of wastewater reportedly enter the Tigris and Euphrates daily, worsening pollution as drought reduces river flows. Regional Diplomacy: Baghdad will host the OIC foreign ministers’ meeting on October 17–18, with Gaza and regional tensions on the agenda. Security: Iraqi intelligence helped Libyan authorities foil an attempt to smuggle 1.2 million Captagon pills into Libya.
Regional Security: Baghdad condemned the deadly attack on Riyadh airport, rejected strikes on civilians and urged a comprehensive halt to military operations. Oil Routes: Iraq expects year-end negotiations with a US-Qatari consortium on a pipeline from Haditha to Syria’s Baniyas coast, an alternative export route to the Mediterranean. Drug Trafficking: Iraqi authorities say they helped Libya foil an attempt to smuggle 1.2 million Captagon pills and arrested a suspect. Economy: The dollar eased to around 164,000 dinars per $100 on parallel markets; Iraq has also suspended import duties on eggs and poultry to help contain food prices after the dinar’s devaluation. Post-Withdrawal Ties: Iraq’s foreign minister and US envoy Tom Barrack discussed future cooperation and the dinar after the US-led coalition’s mission ended. The withdrawal has sharpened debate over militia control and the risk of an Islamic State resurgence.
Dinar and US Ties: Baghdad and Washington discussed post-coalition relations and Iraq’s exchange rate as the dollar eased to around 164,000 dinars per $100 on parallel markets. The Central Bank says import transfers arranged before the rate change must be honored at the old rate. Food Prices: Iraq suspended import duties on poultry and eggs to boost supplies, while Sulaymaniyah inspectors stepped up checks against unjustified price rises. Economists caution that a higher dollar rate does not automatically mean an equivalent rise in prices. Security and Militias: Iraqi forces clashed with ISIS militants in Kirkuk’s Hawija district, killing or wounding several fighters with no reported Iraqi casualties. Moqtada al-Sadr, meanwhile, is presenting himself as a nationalist statesman; he says his armed groups have been dissolved or placed under state control as Baghdad presses factions to disarm. Corruption: Iraq’s crackdown has jailed lawmakers and officials and returned more than $1 billion to state coffers, but questions remain over whether it will reach their political patrons. Development: The government, FAO and World Bank launched a project to improve farm management and strengthen dairy value chains. Iraq is also pursuing an oil-backed funding pact with Turkey for its Development Road project. Public Services: Nineveh plans 135 schools amid high enrolment and a nationwide classroom shortage; Karbala has begun work on a nationwide initiative to distribute one million residential plots.
Security: Iraqi forces clashed with ISIS militants in Kirkuk’s Hawija district after an attack on a checkpoint; several militants were reportedly killed, with no Iraqi casualties. Renewed Iranian drone strikes on Kurdish opposition sites in the Kurdistan Region are adding to concerns after the US troop withdrawal. Currency Fallout: Baghdad is offering construction materials directly to citizens to ease price pressures after the dinar’s devaluation. The Central Bank warned banks not to charge merchants extra on import transfers already covered at the old rate, as lawmakers challenge the new exchange rate ahead of 2027 budget talks. Oil Routes: Iraq expects to begin trucking crude through Syria to the Mediterranean, seeking an alternative as war-related disruption threatens shipments through the Strait of Hormuz. ISIS Detainees: Baghdad rejected Damascus’s request to take back about 4,000 suspected ISIS members transferred from Syria, saying those found guilty of crimes in Iraq will be tried under Iraqi law.
Dinar and Budget: The 14.5% dinar devaluation has triggered a showdown, with lawmakers urging Prime Minister Ali al-Zaidi to reverse the rate before the 2027 budget reaches parliament on Oct. 15. Kurdistan Security: Iran reportedly launched Shahed drones at Iranian Kurdish opposition sites in Iraq’s Kurdistan Region, underscoring security concerns after US forces left. Oil Exports: Baghdad expects to begin trucking crude through Syria to the Mediterranean in mid-October, seeking an alternative as Hormuz disruptions constrain shipments. IS Detainees: Iraq rejected Syria’s request to take back about 4,000 suspected Islamic State members transferred from Syrian prisons, saying those found to have committed crimes in Iraq will face Iraqi law. Climate Policy: Iraq launched an updated climate plan setting emissions-reduction targets through 2035 and linking action to energy and water security. State Authority: With the coalition mission ended, Baghdad faces pressure to bring armed factions under state control while Islamic State attacks remain a concern.
Oil Exports: Iraq expects to begin trucking crude through Syria to a Mediterranean port by mid-October, seeking an alternative as Strait of Hormuz disruptions hamper shipments. Security: Two drones struck Iranian Kurdish opposition sites in Erbil province, in a reported first since US forces withdrew from the region. IS Detainees: Baghdad rejected Syria’s request to take back about 4,000 suspected IS members held in Iraq, saying those found guilty of crimes in Iraq will face Iraqi law. Currency Fallout: Prime Minister Ali al-Zaidi defended the new 1,520-dinar public dollar rate in parliament, citing pressure on state finances. A senior cleric urged reconsideration, while political leaders proposed price protections and other relief measures.
Dinar Fallout: Prime Minister Ali al-Zaidi defended Iraq’s 14.5% dinar devaluation in parliament, citing disrupted oil exports and mounting financial pressure. The ruling Coordination Framework criticized the move and called for relief, as Iraqis face higher prices. Oil Routes: Baghdad is pursuing Syria as an overland route to the Mediterranean to bypass Hormuz disruptions, with the first tanker-truck shipments expected soon. Security: Two drones hit an Iranian Kurdish opposition group’s site in Erbil province, causing a fire but no reported casualties. Iraq also rejected Syria’s request to take back about 4,000 suspected ISIS detainees, saying those accused of crimes in Iraq will face Iraqi law. Travel: Iraqi Airways has resumed direct flights to Iran under a U.S. sanctions waiver, with daily services planned from Najaf to Tehran, Mashhad and Isfahan. Food and Power: The cabinet approved the 2026/27 winter farming plan, including wheat purchases and seed subsidies, while Siemens-backed 400-kilovolt substations are under development in Baghdad, Karbala and Najaf.
Dinar Devaluation: Iraq has reset the official dollar rate to 1,520 dinars, a roughly 15% devaluation as war-related oil disruptions squeeze public finances. MPs are pushing to reverse the move, while households face higher costs for imported goods. Security: With the US-led coalition mission in Iraq formally ended, Baghdad faces greater counter-ISIS responsibility. Recent attacks near Kirkuk killed a police officer and wounded four others, prompting a nighttime curfew in Hawija. Oil and Trade: Exports have stabilized at 2.7 million barrels a day, the Oil Ministry says, bringing in about $4.5–5 billion monthly. Iraq is pursuing routes through Turkey and Syria, while Chinese refiners turn to Iraqi crude as Iranian supplies tighten. Iran Links: Iraqi Airways has resumed direct flights from Najaf to Tehran, Mashhad and Isfahan after a seven-month suspension, following a US sanctions waiver.
Dinar Shock: Iraq’s nearly 15% devaluation sets the official dollar rate at 1,500 dinars for government purchases and 1,520 for public sales. The parallel-market dollar surged, Baghdad markets shut and lawmakers demanded a reversal; the Central Bank says reserves can meet demand, while economists warn prolonged oil losses could force an IMF program. Oil Routes: With Hormuz disruptions squeezing crude exports, Baghdad has formally asked Syria to serve as an alternative route for Iraqi oil. Regional Trade: Qatar and Iraq agreed to establish a joint business council and reviewed investment opportunities tied to the Development Road. Separately, a new fibre deal aims to link Iraq’s Gulf cable connections overland to Türkiye and Europe. Government Formation: A proposed cabinet deal would add four deputy prime ministers, including the brother of a powerful militia leader, drawing scrutiny over the cost of political consensus and militia influence.
Currency Shock: Baghdad reset the dinar’s official rate from 1,320 to as much as 1,520 per dollar, a roughly 15% devaluation tied to disrupted oil revenues. The parallel-market rate topped 170,000 dinars per $100, raising fears of higher import prices. Security: A police officer was killed in an ISIS attack near Kirkuk, while Iraqi forces announced the arrest of a suspected ISIS leader there, days after the US-led coalition’s military mission ended. Turkey Ties: Prime Minister Ali al-Zaidi says Baghdad and Ankara agreed on the withdrawal of Turkish troops from Iraq. Oil Trade: Chinese independent refiners are buying more Iraqi crude to replace Iranian supplies, underscoring Iraq’s role as Gulf exports shift. Connectivity: Ooredoo’s OFN and iQ Networks signed a deal to extend fibre links across Iraq, supporting a planned data corridor between the Gulf and Europe. Anti-Corruption: Investigators uncovered more than 2.19 billion dinars in alleged embezzlement at Salah al-Din’s traffic directorate and opened inquiries into five senior officers.
US Troop Exit & Security Vacuum: The U.S. has fully completed its withdrawal from Iraq, ending Operation Inherent Resolve, but Iraq is already facing fresh pressure as ISIS attacks continue, including a Kirkuk assault that killed a federal policeman and wounded four. PMF & US Flag Row: After U.S. forces left, Iraq’s PMF-linked controversy over trampling a U.S. flag in Baghdad sparked arrests and renewed debate over militia arms and state control. Iraq-Turkey Troops: Prime Minister Ali al-Zaidi says an agreement was reached for the withdrawal of Turkish troops from Iraqi territory. UN Development Deal: Iraq and the UN launched a 2025–2029 Sustainable Development Cooperation Framework in Baghdad, focusing on governance, jobs, environment, and monitoring. Oil & Trade Routes: Iraq’s Iraqi Line will resume Gulf shipping after a 50-year halt, while Iraq also plans new crude routes beyond Hormuz; meanwhile, Chinese independent refiners are buying more Iraqi crude as Iranian supplies fall. Economy & Currency: The U.S. dollar stayed above 160,000 IQD on Iraq’s parallel market despite new cash inflows, reflecting ongoing liquidity and policy uncertainty. Counter-Narcotics: Iraqi forces seized about 250,000 narcotic pills in the western desert, foiling a balloon-based smuggling attempt. Kirkuk ISIS Arrest: Security forces in Hawija arrested a suspected ISIS leader after clashes. Waze Ban: Iraq’s communications minister moved up the ban on the Israeli-developed Waze GPS app to end of December.
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