World Bank: Iraq among the economies hit hardest by the Hormuz closure

The World Bank's April 2026 economic update places Iraq among the economies hit hardest by the conflict that broke out on 28 February 2026 and centred on the Gulf, alongside Iran, Lebanon and the Gulf Cooperation Council states.

The effective closure of the Strait of Hormuz cut traffic sharply: between 2 and 22 March an average of five ships a day crossed the strait, against 96 in the same period a year earlier — a decline of 95%.

The Bank projects a contraction in Iraq's GDP, attributing the greater damage to its heavy reliance on the strait for the transit of traded goods and to a higher incidence of infrastructure damage. Trade and production disruption together with the closure more than offset the gains from higher oil prices, driving downward revisions to both the current account and the fiscal balance.