Iraq’s budget recorded a fiscal deficit exceeding 7.5 trillion dinars ($5.2B) in the first half of 2025, the economic observatory Eco Iraq reported on Saturday, warning that the government faces limited options to contain the gap.
Oilaccounts for more than 90% of total revenues, with official data from January to June showing 56.7 trillion dinars ($39.6B) in oil income out of 62 trillion dinars ($43.3B) in overall revenues. Actual expenditures reached 69.5 trillion ($48.6B) dinars, including 3.1 trillion dinars ($2.17B) for the Iraq-China agreement and 7.5 trillion dinars in licensing round payments.
Eco Iraq cautioned that the deficit poses serious challenges for fiscal stability and urged the government to cut operational spending not tied to salariesand wages. It stressed that higher oil prices cannot be relied upon, noting that Iraq currently sells oil at about $68 per barrel while a price of $81.6 is needed to balance the budget.
