Shafaq News- Baghdad

Iraqi Prime Minister Ali Al-Zaidi on Sunday directed the Oil Ministry to implement government plans to increase crude oil production capacity and revenues as regional conflicts continue to put pressure on Iraq's economy, his office said.

Al-Zaidi issued the directive during a visit to the ministry's headquarters in Baghdad, his second since the government took office five months ago.

Al-Zaidi said the government would take steps to increase oil revenues but did not specify them. He also called for addressing previous mistakes and shortcomings in the oil sector, saying he had instructed the Federal Commission of Integrity to follow up on corruption cases he blamed for inaction and lost opportunities to develop the sector. The deputy prime minister for energy affairs will be tasked with following up on the ministry's work, including oil production and exports.

The directives follow a 53% year-on-year decline in Iraq's oil revenues during the first seven months of 2026, according to Finance Ministry accounts cited by the country's federal revenue oversight authority. Iraq relies heavily on crude exports to finance public spending, leaving its economy vulnerable to disruptions in the Strait of Hormuz caused by the US-Israeli war on Iran.

Iraqi oil production recovered to 4.4 million barrels per day in September, its highest level this year, according to the Financial Times, although renewed attacks on shipping in October have threatened that recovery. Seven OPEC+ producers, including Iraq, agreed on October 4 to maintain their September production targets for November. Separately, a review of members' sustainable production capacity for 2027 remains delayed.

Read more: No exit but Hormuz: Iraq's economic vulnerability exposed