According to the Economic Times, “India’s engineering goods exports to Iraq more than halved in May and have now almost come to a halt due to ongoing clashes between government forces and rebels in the West Asian country.”The drop is recorded in India’s decreased shipments of automobiles, electronic goods, and steel. The slowdown accounts for almost $11 million lost from the previous year. Iraq exports are now down 54.30 percent.
The reduction is closely linked to the ongoing Iraqi rebel war conflict.
In addition to the engineering exports decline, analysts are keeping a close watch on Iraq’s crude oil situation and the conflict’s impact on Iraq’s economy overall.
Where Iraq has failed, the United States has slowly moved in to replace the massive crude oil supplier. The United States now accounts for around 268,000 barrels of crude per day. Although the United States has quietly moved to fill the basin-sized deficit Iraq has left, economists are not confident that the global crude oil troubles are over.
Time reports, “[…] international oil majors like BP and ExxonMobil have already evacuated some of their foreign workers from Iraq. And if things do get worse, oil markets might not react so calmly. A recent report from the nonprofit Securing America’s Future Energy found that the loss of just a third of Iraq’s oil output could be enough to push global oil prices up as much as $40 per barrel.”
The southern tip of Iraq remains relatively safe from the current conflict. Many believe the area will help to rebuild global market confidence in the country.
However, Bloomberg News notes, “Rising exports in the south, helped by the start of a third tanker-loading point this month, contrast with the situation for Kirkuk crude. This light grade from the northern field of the same name hasn’t been exported since March, when sabotage damaged a pipeline to the Turkish port of Ceyhan. Repair work ceased this month when fighting started.”