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By John Lee.

The Ministry of Electricity has confirmed that imported gas supplies from Iran are continuing at a reduced level of six million cubic metres per day (6mcm/d).

Official spokesperson Ahmed Mousa Al-Abadi said the current volumes remain below contracted levels and continue to affect generation units and power stations. He noted that milder temperatures have helped contain demand and maintain relative grid stability.

According to the ministry, the available gas is being directed to key generating units at major load-centre stations, including Basmaya [Bismaya] and Al-Mansouriya. However, reduced flows continue to constrain electricity production.

The ministry estimates that the power system is currently short of approximately 6,000 to 6,500MW of capacity, across both simple and combined-cycle operations, due to limited gas supplies.

It added that coordination is ongoing with the Gas Company to explore the possibility of increasing imported volumes, particularly ahead of the summer peak demand period. The ministry also said that cooperation between the electricity and oil sectors has helped provide alternative fuel to affected generating units.

(Source: Ministry of Electricity)

From the Iraq Britain Business Council (IBBC):

You could be forgiven for thinking that Iraq is only dependant on oil and is a country struggling with conflict. However, reality has moved on from old perceptions and scarcely reflect the recent changes and dynamics that are tangible and progressing well. With a stable economic and political stability, Iraq is back and modernising. Indeed, in the context of the current middle east scenarios, Iraq has been relatively unscathed, muted, and mature in its handling of tensions.

Iraq's financial and investment landscape is remodelling as reforms are starting to show measurable results across a range of sectors and an economy diversifying at pace. IBBC's members have likewise reflected the sectoral diversification, including streaming platforms, event companies, design consultancy capabilities, maritime industries, tourism, recruitment and increasing applications of AI to manage production installations.

For a taster of what has been happening under the noses of the world's media let's see whats been happening across various sectors:

Non-oil GDP has grown at an average rate of about 4% between 2021 and 2023, signalling diversification after years of volatility. Foreign direct investment inflows reached a new record of $24bn in 2025 up from $2.6 billion in 2020, reflecting opportunities and investor confidence.

The Banking sector is modernization: electronic payment usage increased by more than 120% between 2021 and 2023, driven by greater adoption of POS systems and digital wallets. The CBI launched the National Financial Inclusion Strategy (2025-2029) to expand digital banking and microfinance supporting the private sector and restructuring major state-owned banks. These shifts are changing how regional and global markets view Iraq's financial stability.

Oil is important as Iraq plans to double oil production but also diversify its energy mix, to 8mb/d by 2027, expand energy infrastructure, including nuclear, gas, and solar projects, with significant investments totalling USUSD 620bn by 2030. Key initiatives involve increasing power capacity to 44GW by 2025, developing 11GW of nuclear energy, and enhancing regional electricity interconnections, corresponding to 33% of the power capacity mix thanks to a sharp increase in solar capacity (5.3% in 2024). including a $500 million waste-to-energy plant in Baghdad and the distribution of loans via the Central Bank of Iraq for residential solar panel installations. Shell has returned to Iraq to convert gas to electricity and gas as a form of power is increasingly important. The 2024-2028 plan intends to reduce the oil sector's contribution to GDP by up to 25% and bring unemployment down to 10%.

Across the broader economy, reconstruction and diversification efforts are reshaping both domestic and international perceptions. Iraq recorded a GDP of roughly $267 billion in 2023, making it one of the largest economies in the region.

Government spending on education rose to 9% of total public expenditures, supporting workforce development. Enrolment in Iraqi universities has grown by 30% since 2018, reflecting increasing emphasis on skills needed for a diversified economy. Combined with infrastructure projects these activities are shifting Iraq towards modernization and long-term economic planning.

Technology and agriculture are showing data-backed evidence of transformation. Iraq's ICT market grew by an estimated 14% in 2023, supported by expanded fibre-optic coverage and rising demand for digital services. Investment is being directed into agriculture (agritech), manufacturing, and the technology/media sectors, as the government prioritises climate-smart agriculture to combat water scarcity and have secured investments for three new industrial cities to stimulate local manufacturing. In agriculture, wheat production reached over 6 million tons in 2023, one of the highest outputs in Iraq's history, due to improved irrigation and government procurement programs.

E-government adoption has accelerated, as over 1.5 million citizens are using new online government platforms since 2022.

A $17 billion transport corridor of highways and railways are set to link the Grand Faw Port in Basra to the Turkish border, positioning Iraq as a regional trade hub between Asia and Europe. IBBC's own members are part of the push to develop the Maritime industry in Basra with an academy and investment into ship building.

IBBC's members reflect the dynamics of change, with initiatives in the Maritime economy, Tech, education and renewable power and finance. Iraq is back and its modernising. Now is the time to engage in one of opportunity economies in the region, early adopters will benefit from market entry as reality is ahead of perception

At IBBCs Mansion House conference on 9th June we are focusing on these changes with the people making the changes, and the opportunities the evolving Iraqi economy offers investors and citizens alike.

By Guest Blogger. Any opinions expressed are those of the author(s), and do not necessarily reflect the views of Iraq Business News.

The Iraqi Dinar Caught in the Crossfire: What a Trump-Iran Military Conflict Would Mean for Iraq's Currency

The Middle East is once again on the edge. The United States has assembled its largest concentration of naval and air power in the region since the 2003 invasion of Iraq, two carrier strike groups, dozens of warships, and hundreds of warplanes now positioned within striking distance of Iran.

Negotiations between Trump's envoy Steve Witkoff and Iranian officials in Geneva have reportedly yielded "significant progress", but the ultimate outcome may hinge on whether Iran is prepared to offer concessions significant enough for Trump to call a victory. With diplomacy fragile and military options on the table, one often-overlooked casualty of any escalation would be Iraq's currency, the dinar.

Iraq: The Battlefield Between Two Worlds

To understand what a US-Iran military conflict would do to the Iraqi dinar, you have to first understand Iraq's precarious geopolitical position. The country is simultaneously a close security partner of the United States and an economy deeply enmeshed with Iran. Iraq spends roughly $900 million monthly on Iranian goods, a major portion of this historically going to electricity and gas. Iranian-backed militias are embedded within Iraq's state institutions. US troops remain on Iraqi soil. Iraq's government walks a tightrope between US alliance and Iranian influence, and its currency walks the same tightrope with it.

The Iraqi dinar's journey has been one of the most dramatic in monetary history. The currency dropped substantially from 3 IQD per USD before 1991 to about 1,310 IQD per USD today. Decades of war, sanctions, and corruption have slowly eroded its value. In recent years, Iraq has made modest progress: the International Monetary Fund (IMF) has provided structural guidance, oil revenues have been strong, and the Central Bank of Iraq (CBI) has maintained a managed peg to the dollar. Iraq's position as OPEC's second-largest oil producer and strong international support drive steady economic improvements. But all of that relative stability would face severe pressure the moment US bombs begin falling on Iranian soil.

Scenario One: A Limited Strike

The most likely immediate military scenario, and the one that has been most openly discussed in Washington, involves a targeted, time-limited campaign against Iranian military and nuclear infrastructure. Trump may order a targeted attack on select military sites inside Iran to pressure the country's leaders into agreeing to an acceptable deal, demonstrating US threats of action are real. The targets could include ballistic missile sites, facilities connected to Iran's nuclear program, or buildings used by the Islamic Revolutionary Guard Corps.

In this scenario, the Iraqi dinar's fate would be shaped by several competing forces. On one hand, oil prices would almost certainly spike, and for Iraq, higher oil prices are a lifeline. Iraq's state budget is overwhelmingly dependent on petroleum revenues, and a sudden surge in global crude prices triggered by conflict fears would, in theory, fill state coffers. A better-funded government can defend its exchange rate more effectively.

On the other hand, a limited strike would almost certainly trigger Iranian retaliation, and Iraq would be squarely in the blast radius. Iran's kinetic retaliation plan relies on a reconstituted arsenal of over 3,000 ballistic missiles capable of striking US bases and allied territory across the region, and many of those bases are in Iraq. US embassies in Iraq and other Arab states began to evacuate personnel in response to Iranian threats on American bases as far back as the lead-up to last year's Operation Midnight Hammer. Iranian-backed Iraqi militias like Kataib Hezbollah have already issued explicit warnings: leader Ahmad al-Hamidawi warned that any strike on Iranian soil would trigger a "total war" involving militias across the Levant.

For the dinar, this translates to a severe confidence crisis. When violence erupts on Iraqi soil, even if Iraq is not the primary combatant, foreign capital flees, domestic savers rush to convert dinars to dollars, and the black market premium widens dramatically. The Central Bank of Iraq, which sells dollars at auction to defend its peg, would come under enormous pressure. Its foreign exchange reserves, while substantial, are not unlimited, and a sustained capital flight could force a de facto devaluation.

Scenario Two: Sustained Military Campaign or Regime Change

Current contingency planning in the Pentagon is configured for sustained, weeks-long operations against Iran if so ordered by Trump. A broader campaign aimed at degrading Iran's military capacity, or worse, one that tips into regime change, would represent a qualitatively different shock to the Iraqi economy.

Iraq's energy dependence on Iran is the most acute vulnerability. If war disrupts those supply lines, through Iranian cut-offs, infrastructure damage, or US sanctions enforcement, Iraqi power grids would come under renewed pressure. Blackouts would damage industry, commerce, and ordinary life. Economic output would contract sharply, and the government's ability to pay civil servant salaries and maintain social order would erode. In such conditions, the dinar would face significant downward pressure regardless of what the oil price is doing.

There is also the migration and refugee dimension. A major war with Iran, a country of over 90 million people, could produce refugee flows that would dwarf anything the region has seen since 2003. Iraq, which shares a long border with Iran and already hosts displaced populations from earlier conflicts, would be on the front lines of that humanitarian wave. The fiscal and social cost could be immense.

For currency markets, the historical parallel is instructive. During the 2003 US invasion of Iraq itself, Iraqi currency markets experienced extreme dislocations. Capital flight, hoarding of hard currency, and the collapse of normal economic activity all preceded any formal devaluation. A war next door, one that also engulfs Iraqi militias and potentially Iraqi territory, could produce similar dynamics even without Iraq being the primary target.

The Oil Price Paradox

One of the most important, and often misunderstood, dynamics in this scenario is the double-edged nature of oil prices. A major US-Iran conflict would almost certainly send crude prices sharply higher, at least initially. Iran is a significant oil producer, and any conflict that threatens the Strait of Hormuz, through which roughly 20% of the world's oil supply passes, would trigger immediate panic buying in global energy markets.

For Iraq, this creates a cruel paradox. Higher oil revenues would, in theory, improve the government's fiscal position and its ability to defend the dinar. But the same conflict that pushes oil prices up would simultaneously disrupt Iraq's own oil export infrastructure, close off Iranian energy imports that keep the lights on, trigger militia violence, scare away foreign investment, and force emergency spending on security. The net effect on the dinar would almost certainly be negative, as the costs outweigh the revenue windfall.

The Sanctions and Banking Dimension

Any escalation would also intensify the already complex sanctions environment that shapes how the Iraqi economy interfaces with the global financial system. The Trump administration focuses on selective sanctions against Iraqi banks while conditioning waivers for Iranian energy purchases. This policy could soon affect Iraq's economic partnerships and currency stability. Banks found to be facilitating Iranian transactions face being cut off from dollar-clearing networks, a potentially devastating punishment in an economy that relies so heavily on the greenback.

This creates a further squeeze on the dinar. If Iraqi banks are penalised for maintaining ties with Iran, ties that are partly economically necessary and partly politically unavoidable, the result is a fragmentation of Iraq's banking sector, reduced access to dollar liquidity, and a wider spread between the official and parallel exchange rates. Ordinary Iraqis, who already prefer to hold savings in US dollars rather than dinars, would accelerate that dollarisation, further undermining confidence in the local currency.

Historical Lessons: What 2003 Tells Us

The 2003 US invasion of Iraq offers a partial precedent, though the situations differ significantly. In the immediate aftermath of the invasion, the Iraqi currency market experienced extreme volatility. The old Saddam-era dinar was eventually replaced with a new currency, and a managed peg to the dollar was established. Over time, with massive oil revenues and international support, the new dinar stabilised.

But the early years of post-invasion Iraq were characterised by exactly the kind of dynamics a new conflict would recreate: capital flight, dollarisation, black market currency trading, and a gap between official and street exchange rates. The key difference now is that Iraq is not the direct target of military action, but it is the unavoidable collateral victim, geographically, economically, and politically sandwiched between the two combatants.

What Investors and Observers Should Watch

For those tracking the dinar, whether as currency speculators, businesses operating in Iraq, or observers of the wider regional economy, the key indicators to monitor are:

The Central Bank of Iraq's foreign exchange auction volumes and reserves. A sharp drop in reserves or a sudden suspension of dollar auctions would signal that the peg is under existential pressure. The spread between the official exchange rate and the parallel market rate. Historically, this spread widens during periods of political and security stress, and a significant widening would be an early warning of impending devaluation. The status of Iranian energy supplies to Iraq. If gas flows are disrupted and the lights go out, the economic fallout would be rapid and severe. And crucially, the behaviour of Iraq's Iranian-backed militias. If they activate in response to US strikes on Iran, Iraq would transition from bystander to active warzone, and the dinar would face its most serious crisis since 2003.

Conclusion: A Currency with No Good Options

The Iraqi dinar is, at its core, a hostage to forces far beyond Baghdad's control. Iraq's government has limited ability to insulate its currency from a major military confrontation between the United States and Iran, a conflict whose epicentre would be on its doorstep and whose shockwaves would run directly through its energy sector, banking system, and political fabric.

Administration officials have been unclear about what their objectives are as they confront Iran, and that uncertainty itself is a risk factor for the dinar. Markets hate ambiguity, and a conflict with no clear endgame is the worst of all possible scenarios for a currency already carrying the weight of decades of instability.

In the best case, a short, sharp military strike followed by a rapid return to negotiations, the dinar would likely suffer a temporary shock: a flight to dollars, a widening of the parallel market premium, and a drawdown of central bank reserves, but ultimately a manageable correction. In the worst case, a sustained campaign, militia activation across Iraq, energy supply disruption, and a regional war, the dinar would face its most severe test since the 2003 invasion. The outcome would depend not just on what the US military does to Iran, but on whether Iraq can remain a bystander in a war that, by its very geography, it cannot escape.

This article reflects the geopolitical and economic situation as of late February 2026. It does not constitute financial or investment advice.

For more information on the Iraqi dinar, check out IBN's Dinar Page here: https://www.iraq-businessnews.com/the-dinar-page/?swcfpc=1 

See also:

If Trump Strikes Iran: Mapping the Oil Disruption Scenarios

Dinar Weakness: CBI "Not Responsible"

Iraqi Banks Restricted from US Dollar Transactions: FULL LIST [Amended]

2026: The Year Iraqi Dinar Speculators Finally Strike Gold?

Dinar Explainer 1: Why Iraq has Two Exchange Rates

Donald Trump and the "Great Iraqi Dinar Revaluation"

(Picture: The U.S. Navy aircraft carrier USS Gerald R. Ford (CVN-78), currently on route to the region).

Advertising Feature

Rabee Securities Iraq Stock Exchange (ISX) market report (trading week ending: 26th February 2026.

Please click here to view a table of listed companies and their associated ticker codes.

For the RS Market Index charts, please click HERE.

 Top 5 Gainers - Weekly

(1) Excluding OTC market

Iraq Stock Exchange

• The Central Bank of Iraq (CBI) has announced updated lists of banks and companies prohibited from dealing in US dollars as part of its ongoing banking sector reform initiative. According to the new update, International Development Bank (BIDB) was added to the list on May 11, 2025. (CBI)
• The Kurdistan Regional Government announced the official joining of the Iraqi Islamic Bank (BIIB) to the national electronic payment project "e-Pswla," a move aimed at facilitating electricity bill payments for citizens and promoting digital transformation. (Bas News)
• Babylon Hotel (HBAY) invited its shareholders to receive their cash dividends for the fiscal year 2023 & 2024 at the company's hotel. The company decided in its recent AGM (Dec. 24, 2025) to distribute IQD6.5 cash dividend per share, corresponding to a 6.5% dividend yield.
• ISX suspended trading of Hammurabi Commercial Bank (BHAM) (OTC) starting Feb. 25 due to the AGM that will be held on Feb. 25 to discuss and approve increasing the paid-in capital from IQD201.0 bn to IQD267.3 bn through a 32.985% rights issue, and selecting the path for continuing to carry out banking activities according to what is stated within the Banking Reform Document. The company resumed trading on Feb. 26.
• Iraqi Carton Manufacturies (IICM) fulfilled ISX's request to explain why the prices touched the lower limit on Feb. 18 and Feb. 19. The company disclosed that there were no fundamental events or new matters that affected the price of the shares.
• Elaf Islamic Bank (BELF) fulfilled ISX's request to explain why the prices touched the higher limit on Feb. 23 and Feb. 24. The company disclosed that there were no fundamental events or new matters that affected the price of the shares.
• Electronic Industries (IELI) fulfilled ISX's request to explain why the prices touched the lower limit on Feb. 23 and Feb. 24. The company disclosed that there were no fundamental events or new matters that affected the price of the shares.
• The International Development Bank (BIDB) announced the launch of three new financial and investment products targeting investors, entrepreneurs, startups, and small and medium-sized enterprises (SMEs). The bank says this initiative aims to enhance liquidity, stimulate economic growth, and empower the private sector through flexible solutions with competitive returns. (Shafaq News)

Stocks that were suspended / will be suspended from trading:

• ISX will suspend trading of Al-Mansour Bank (BMNS) starting Mar. 11 due to the AGM that will be held on Mar. 17 to discuss and approve 2025 annual financial statements, dividend distribution, and increasing the paid-in capital from IQD445.0 bn to IQD585.0 bn through a 31.46% bonus issue.
• ISX will suspend trading of Electronic Industries (IELI) starting Mar. 26 due to the AGM that will be held on Mar. 31 to discuss and approve the 2020 annual financial statements.

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By John Lee.

Iraq's Council of Ministers has authorised the Ministry of Electricity to contract Excelerate Energy for the construction of a floating platform to import liquefied natural gas (LNG).

The decision forms part of ongoing efforts to establish a floating LNG import terminal and is based on Cabinet Decision No. 878 of 2025.

In October, the Ministry of Electricity and Excelerate Energy agreed on a floating storage and regasification unit (FSRU) with a capacity of 15 million cubic metres per day. The five-year renewable agreement would supply natural gas to power generation plants, supporting diversification of gas sources to meet national demand.

(Source: PMO)

By John Lee.

A $65-billion investment is planned to transform the Al-Tayeb border area into a multi-service economic city, according to the National Investment Commission (NIC).

Commission Chairman Dr Haider Mohammed Makkiya (pictured) told the state-run Iraqi News Agency (INA) that Al-Tayeb is envisaged as an economic city covering more than 120,000 dunams, with total projected investments exceeding $65 billion.

Of this amount, approximately $5 billion is allocated for infrastructure, including:

• Roads;
• Electricity networks;
• Sewerage systems;
• Other core utilities.

Makkiya said the location [in Missan/Maysan] benefits from abundant natural resources, including water, fuel, sand and gravel, as well as favourable terrain, which he said would support the development of a specialised economic city.

He added that completion of a water-harvesting component remains pending, and that the project could be announced as an investment opportunity in the coming months.

Makki also said that six investment cities have been identified based on the availability of natural resources, with multi-service economic cities potentially developed along the Development Road corridor.

(Source: Iraqi News Agency)

By John Lee.

Iraq's Ministry of Oil has announced the inauguration of a gas-fired power generation plant at the Faw [Fao] oil depot, aimed at strengthening export capacity and supporting energy stability in the southern region.

The project was launched under the direction of Deputy Prime Minister for Energy Affairs and Minister of Oil, Hayan Abdul Ghani, and inaugurated by the Director General of the State Oil Projects Company (SCOP), Ali Ward Hammoud.

According to the Ministry, the station will provide a total generation capacity of 150 megawatts, through the installation of three units rated at 50 megawatts each under ISO standard conditions. The facility is designed to ensure stable electricity supply to operational units within the Fao oil depot, enhancing storage and export efficiency at one of Iraq's key oil export outlets.

The Director General stated that technical challenges related to soil conditions and foundation subsidence at the Fao site were addressed through comprehensive engineering studies and redesigns prepared by the company's Design Authority. Advanced engineering solutions enabled continued implementation in line with the project schedule.

The South Projects Authority supervised on-site execution and coordination among engineering and technical teams, while the Projects Management Authority oversaw planning, field monitoring, and administrative follow-up to ensure adherence to timelines.

The project was designed and supplied by Siemens and executed by Al-Rafidain Petroleum Services Company (ROSCO), under the direct supervision of the Oil Projects Company.

(Source: Ministry of Oil)

By John Lee.

The National Investment Commission (NIC) has reviewed progress on the Nahrawan City project in Baghdad, a 2,500-dunum development comprising 8,000 fully serviced housing units.

The infrastructure works are being implemented by Al-Asim Real Estate and Tourism Investment Company, covering utilities and essential services for the planned residential community.

During a site visit, Commission Chairman Dr Haider Mohammed Makkiya was briefed on the commencement of 1,000 housing units to be developed by Damac Properties. The homes, each with an area of 200 square metres, are being built on serviced land without financial cost to the state under an investment partnership model.

The project forms part of the government's strategy to promote productive investment and service-exchange models with licensed investors, aimed at supporting housing delivery.

The integrated infrastructure package includes:

• Sewerage networks
• Stormwater drainage systems
• Potable water networks
• Electricity networks
• Main and secondary roads

The development will also include schools, healthcare centres and government service facilities, designed to create a fully integrated urban environment.

Construction works began at the start of the year following approval of designs by the Ministry of Construction and Housing, with the Commission emphasising adherence to technical specifications and project timelines.

(Source: National Investment Commission)

By John Lee.

The Kurdistan Regional Government (KRG) has launched the e-Psule platform, a unified digital system for issuing government payment receipts, as part of efforts to modernise public financial services and reduce reliance on cash-based and paper processes.

The platform has been officially approved by the Central Bank of Iraq (CBI) and is designed to provide citizens across all governorates of the Kurdistan Region with round-the-clock access to government receipts, starting with electricity bills, without the need to visit government offices.

The service is provided free of charge, with no additional fees or commissions applied to payments made through the platform or its authorised partners.

Key features of the e-Psule platform include:

• Full user control, with no deductions from salaries or bank accounts without explicit citizen consent
• Transparent digital receipts showing a clear breakdown between outstanding balances and current charges
• Multiple payment channels, including the e-Psule application, approved e-wallets such as FastPay, AsiaPay and NassWallet, and participating banks including FIB and Cihan Bank

The initiative is intended to strengthen financial transparency, improve service efficiency and support the KRG's broader digital transformation agenda.

(Source: Kurdistan Regional Government)

By John Lee.

The Ministry of Electricity has launched the first phase of its smart transformation and electronic billing project, covering selected areas of Baghdad and several provinces.

The Ministry said the areas included in the initial phase were chosen following studies of electricity networks, loads, feeders, and subscriber data.

According to a Ministry spokesperson, the project aims to improve load management, rationalise daily electricity consumption, reduce losses and waste, and enable the electronic collection of electricity payments.

The first phase includes:

• Installation of smart meters in selected areas of Baghdad and other provinces
• Electronic collection of electricity charges
• Improved control and organisation of high electrical loads

The Ministry said additional phases of the smart transformation project will be launched sequentially. Consumers were encouraged to adopt electronic payment methods for settling electricity bills, noting that a pre-emptive plan has already been developed to regulate loads and collection processes.

The spokesperson added that electronic billing will reduce time and effort, limit cash handling, prevent incorrect meter readings, reduce pressure on the national grid, and support more efficient electricity consumption through accurate digital calculation and payment.

(Source: Ministry of Electricity)