Baghdad: An economist informed NINA that the recent surge in oil prices will enable Iraq to pay off a portion of its domestic debt. Economic expert Dirgham Muhammad Ali emphasized that with oil prices reaching $108, Iraq has the opportunity to mitigate the budget deficit and address some of its internal debt issues. He stressed the importance of utilizing this increase to alleviate the financial gaps experienced in recent months.

According to National Iraqi News Agency, Muhammad Ali stated that Iraq’s current strategy of adopting flexible export mechanisms could allow the country to maximize its oil exports, thereby generating much-needed revenue. This revenue is crucial for addressing the budget shortfall and could be directed towards reducing internal debt, contingent upon Iraq’s ability to export its quota as per the OPEC+ agreement.

Muhammad Ali further remarked that Iraq’s favorable relations with both Iran and the United States could be advantageous in securing stable routes for exporting Iraqi oil. This could enable Iraq to market quantities equivalent to, or slightly less than, previous exports, thus compensating for the recent financial shortfalls.

Oil prices experienced a significant increase of over 2% on Monday, following renewed Houthi attacks on Saudi Arabia and Iranian assaults on ships. In the Gulf, concerns over supply disruptions have grown, exacerbated by the closure of a major Saudi oil pipeline.