Iraq Economic News and Points To Ponder Tuesday Afternoon 7-28-26
Oil Drops Over $1 On US-Iran Peace Hopes
2026-07-28 Shafaq News Oil prices extended declines on Tuesday, down by over $1 per barrel amid hopes for a resolution in the U.S.-Iran war which significantly disrupted global energy flows.
Brent crude futures were down $1.47, or 1.66%, at $86.89 by 0326 GMT, their lowest since July 20. U.S. West Texas Intermediate crude was at $81.16 a barrel, down $1.45, or 1.76%, also the lowest level since July 20.
Both contracts slid around 8% in the prior session after the U.S. abruptly suspended a campaign of air strikes against Iran over the weekend.
U.S. President Donald Trump said on Monday the United States was having "good talks" with Iran and that there was a chance of a resolution.
However, he said U.S. strikes would resume if negotiations failed while Iran issued similar comments about retaliation.
"For now, the relief that an off-ramp has been found has taken the heat out of prices and eased concerns around Houthi attacks on Saudi infrastructure.
However, the situation remains highly fluid," IG analyst Tony Sycamore said in a client note.
Afrah al-Zouba, the foreign minister-designate of Yemen's internationally recognised Saudi-backed government, said Yemen-based Houthi fighters aimed to replicate Iran's control of shipping through the Strait of Hormuz at Bab el-Mandeb.
"Whether the Houthis have the military capacity to enforce a comprehensive blockade is questionable, especially given that the Saudis will attack them relentlessly.
Still, there is no doubt that traffic has dropped off significantly in the Red Sea and the Strait of Hormuz," Marex analyst Edward Meir said.
"A key reason prices are not even higher than they are right now is the demand destruction that is taking place, especially in Asia," Meir said.
Also weighing down oil prices was news that the Caspian Pipeline Consortium's Black Sea terminal on the Russian coast has resumed oil loadings, after a one-week stoppage following Ukrainian drone attacks.
Still, analysts warned that the risks to supply disruptions spreading to the Red Sea remain elevated after Saudi Arabia said it shot down drones aimed at petroleum targets, including in Riyadh. It said they had been launched from Iraq by Iran-backed armed groups, and it reserved the right to respond.
Separately, Iran's Houthi allies in Yemen said they had targeted the East-West Pipeline carrying oil to Saudi Arabia's main Red Sea port of Yanbu in retaliation for Saudi drone incursions.
Barclays analysts said in a note on Monday "flows through the strait remain subdued".
They said, in the week ended July 24, crude oil and refined product net exports through the strait averaged 2.9 million barrels a day compared with 5.9 million in the previous week.
Elsewhere, U.S. crude oil stockpiles likely fell last week alongside gasoline, while distillate stocks likely rose, a preliminary Reuters poll showed on Monday. (REUTERS) https://www.shafaq.com/en/Economy/Oil-drops-over-1-on-US-Iran-peace-hopes
Basrah Crudes Plunge Amid Global Oil Losses
2026-07-28 Shafaq News- Basrah Iraq’s Basrah crude tumbled more than 17% on Tuesday, while major global benchmarks declined.
Basrah Heavy crude dropped by $11.63, or 17.67%, to $54.19 per barrel, while Basrah Medium crude fell by $11.63, or 17.07%, to settle at $56.49 per barrel.
Brent crude futures declined by $1.47, or 1.66%, to $86.89 per barrel, while US West Texas Intermediate crude lost $1.45, or 1.76%, to $81.16 per barrel, with both benchmarks hitting their lowest levels since July 20.
https://www.shafaq.com/en/Economy/Basrah-crudes-plunge-amid-global-oil-losses
Gold Slips Ahead Of Fed Rate Decision
2026-07-28 02:41 Shafaq News Gold prices fell on Tuesday, pressured by a stronger dollar, while markets looked to the Federal Reserve's upcoming policy decision for clues on the interest rate outlook.
Spot gold fell 0.7% to $4,045.89 per ounce by 0448 GMT after rising as much as 1% on Monday. U.S. gold futures for August delivery lost 0.8% to $4,046.20.
The dollar held near a one-month high, making greenback-priced bullion more expensive for holders of other currencies.
"We're oscillating in this narrow range between $3,950 and $4,200, and I think the market is just waiting for Fed signals," said Ilya Spivak, head of global macro at finance content network Tastylive.
The U.S. Federal Reserve will conclude its two-day policy meeting on Wednesday. Expectations that the Fed will hold interest rates steady stand at 62%, while 38% of market participants expect at least a 25-basis-point rate hike, according to CME FedWatch, that is up from 16% a week earlier.
Markets are pricing in an 81% chance for a hike at the central bank's September meeting.
President Donald Trump on Monday called on the Fed to lower interest rates, saying the U.S. should have the lowest interest rate in the world.
Trump also said on Monday that the United States was having "good talks" with Iran and there was a chance of a deal to resolve their conflict, but warned that strikes would resume if negotiations failed to deliver.
Tehran appeared to quickly test the pause in the U.S. military campaign, with Saudi Arabia, Jordan and Iraq reporting drone attacks on Monday.
Spivak added that if the Fed meeting generates language that's not setting the groundwork for a rate hike in September, gold is likely to rally above $4,200 per ounce.
Spot silver fell 2% to $57.23 per ounce, platinum lost 0.9% to $1,605.93 and palladium slid 1.6% to $1,270.97. (REUTERS)
https://www.shafaq.com/en/Economy/Gold-slips-ahead-of-Fed-rate-decision
Diesel Shortage Worsens In Baghdad As Queues Lengthen
2026-07-28 Shafaq News- Baghdad (Updated) A Diesel shortage in Baghdad worsened on Tuesday as lines of vehicles outside fuel stations grew longer, part of a supply crisis affecting most of Iraq in recent days.
The shortage, which extends to Baghdad and several provinces, stems from higher domestic demand as private neighborhood generators consume more fuel during the summer, alongside reduced output at several oil refineries, energy specialist Asem Jihad told Shafaq News, adding that the government supplies Diesel free of charge to private generators under a program to support power provision for citizens, while also meeting the needs of other sectors that depend on the fuel. “That has raised demand markedly at a time when domestic refineries cannot meet the full requirement, owing to limited production capacity and maintenance at some refining units.”
Read more: Fuel shortages paralyze Erbil gasoline stations
To cover the shortfall, the Ministry of Oil has turned to importing Diesel to sustain supply to private generators and local markets, Jihad said, considering this step a temporary measure until domestic refinery output increases and projects to develop the refining sector are completed.
Poor-quality Fuel Strains Iraq Generators
Owners of private electricity generators said the fuel used to run their machines has deteriorated in quality and become harder to obtain, causing repeated technical faults.
One owner, who runs three private generators, told Shafaq News that some of his machines had begun to run erratically because of the fuel, with sensors malfunctioning during operation and dragging down performance. "If the situation continues like this, we will be forced to stop the generators, because there is not enough fuel to run them."
Read more: Iraq’s energy emergency: Kerosene shortages disrupt power and daily life
https://www.shafaq.com/en/Economy/Kerosene-shortage-worsens-in-Baghdad-as-queues-lengthen
USD/IQD Exchange Rates Drop In Baghdad, Erbil
2026-07-28 Shafaq News- Baghdad/ Erbil The US dollar weakened against the Iraqi dinar on Tuesday morning, hovering around 150,000 dinars per $100 in Baghdad and Erbil, according to a Shafaq News market survey.
In Baghdad, the dollar traded at 149,900 IQD per $100 at the Al-Kifah and Al-Harithiya central exchanges, down from 150,050 IQD on Monday.
Exchange shops in the capital offered the dollar at 150,500 IQD per $100, with a buying price of 149,500 IQD.
In Erbil, the capital of the Kurdistan Region, the dollar was selling at 150,150 IQD per $100 and buying at 150,050 IQD per $100. https://www.shafaq.com/en/Economy/USD-IQD-exchange-rates-drop-in-Baghdad-Erbil-8-0