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Iraq devalues currency to 1,500 dinars per dollar amid regional oil shipping disruptions

The central bank acted after maritime trade bottlenecks and regional conflict widened exchange gaps and increased export costs.

Updated Oct 8, 2026 · 16:43 UTC3 reports

The short version

  • Iraq officially devalued the dinar from roughly 1,300 to 1,500 per dollar following a cabinet decision to address financial and economic demands.[ABC News]
  • Regional conflict between the U.S. and Iran disrupted Strait of Hormuz shipping, forcing costlier overland oil exports through Syria and expanding the spread with unofficial exchange rates.[ABC News]
  • Following the announcement, parallel market rates spiked beyond 1,700 dinars per dollar, raising concerns for merchants and consumers reliant on imports.[ABC News · Associated Press]

Key facts

  • Iraq altered its official rate from approximately 1,300 dinars to 1,500 dinars per U.S. dollar on Wednesday.[ABC News · Associated Press]
  • The central bank indicated the policy shift was approved at a cabinet meeting to satisfy monetary, financial, and economic needs.[ABC News · Associated Press]
  • The previous benchmark exchange rate had been established in 2023.[ABC News]
  • The gap between official and parallel exchange rates broadened due to Strait of Hormuz transit disruptions and the U.S.-Iran conflict.[ABC News · Associated Press]
  • Iraq turned to overland oil transit through Syria, which is more expensive and less efficient than marine routes.[ABC News · Associated Press]
  • The unofficial exchange rate rose past 1,600 dinars prior to the decision and surged past 1,700 dinars per dollar afterward.[ABC News · Associated Press]
  • Under the updated structure, the Finance Ministry supplies dollars at 1,500 dinars each, while commercial bank clients purchase them at 1,520 dinars.[ABC News]

What remains uncertain

  • The extent to which market exchange rates will stabilize or continue climbing above 1,700 dinars remains unknown.[ABC News · Associated Press]

Sources

Outlet counts describe coverage, not independent confirmation. Reports may share a wire service or original source.