According to a detailed report by Al Jazeera English, the US and Israeli war against Iran over the past five months has faced the Iraqi Kurdistan Region with heavy security and economic consequences. Accordingly, although the region has tried to distance itself from the conflict and remain neutral, hundreds of missile and drone attacks have been carried out on various targets in the region.

Masrour Barzani, Prime Minister of the Kurdistan Region, announced in an interview with Al Jazeera that the region has paid a "heavy price" for this war.According to him, the Kurdistan Region has been directly targeted by missiles and drones more than a thousand times since the war began in February.

 “We have been directly targeted by missiles and drones more than a thousand times,” Barzani said. “We believe that all these attacks on Kurdistan are unjustified. Unfortunately, we have suffered casualties, we have lost our people, and much of our infrastructure has been severely damaged.”

The regional prime minister stressed that the security consequences of the war have been directly transferred to the regional economy. “The regional conflict and its security consequences have caused a 70 percent reduction in trade throughout the Kurdistan Region of Iraq,” he said.

War Damages 1.5 Trillion Dinars

According to data from the Kurdistan Regional Government, the attacks carried out in recent months have covered a wide range of targets, from military and security centers to energy facilities, bases and headquarters of Kurdish opposition parties.One of the most direct consequences of these attacks has been the damage to the region’s economy. The oil and gas sectors, corporate activity and foreign investment flows have been affected by the insecurity caused by the war, at a time when the Kurdistan Region has been struggling with a chronic financial crisis for years and is still at odds with the central Iraqi government over employee salaries, oil sales and public revenues.

Peshwa Huramani, a spokesman for the Kurdistan Regional Government, put the cost of the war in the region at around 1.5 trillion Iraqi dinars, or around 1.14 billion dollars, as of April.Houramani told Al Jazeera: "The damage caused to the Kurdistan Region as a result of the war as of April is estimated at 1.5 trillion Iraqi dinars, equivalent to 1.14 billion dollars, and these figures have been provided to the Iraqi government."

He stressed that the Kurdistan Region should not have been targeted. "There is no compelling reason to attack the Kurdistan Region," he said. "We have not been a party to this war and will not be, and we have not taken any action to turn the Kurdistan Region's territory into a launching pad for attacks on Iran."

Kurdish officials say they have identified the perpetrators of the attacks on the region and provided their names to the central government in Baghdad, but so far no effective action has been taken to stop the attacks.

"We have provided the names of these groups to the previous and current Iraqi governments," a spokesman for the regional government said.These are groups that illegally carry weapons outside government institutions, but so far the Iraqi government, both the previous and current, has not taken any action against these groups.”

Meanwhile, other parts of Iraq have not been spared attacks. Baghdad International Airport, which houses a military base and a US diplomatic center, has been targeted by rockets and drones, as have oil fields and other Iraqi facilities.

Jabar Yawar, a security expert and former secretary-general of the Kurdistan Regional Government’s Ministry of Peshmerga, said the groups do not follow the orders of the Iraqi government.

 “The constant barrage of bullets from armed groups that operate outside the law, know everyone and do not follow the decisions of the commander-in-chief of the Iraqi armed forces, is creating security problems for the Kurdistan Region,” he said.»

He also said about the origin of the attacks: “Most of the bombing operations are carried out from the Nineveh Plain and areas near Kirkuk and Salahuddin.”

According to Yawar, one of the main problems of the region and the central government of Iraq is the lack of a comprehensive air defense system; an issue that has increased the region’s vulnerability to missile and drone attacks.

The shock of the closure of the Strait of Hormuz and the Iraqi oil crisis

According to Al Jazeera, the economic consequences of the war are not limited to the Kurdistan Region and have put pressure on the entire Iraqi economy. In response to the disruption of shipping in the Strait of Hormuz and the cessation of most of the country’s crude oil exports, the Iraqi Ministry of Oil has declared a state of “emergency” in all oil fields under development by foreign companies.

Within the framework of this decision, the Iraqi government has issued an order to stop oil production and, based on existing contracts, foreign companies will not receive compensation for unproduced oil.The crisis occurred at a time when the government of Prime Minister Ali al-Zaidi had based a new economic program on the development of the “Development Road” project, expanding cooperation with the private sector, and increasing the participation of international companies, with the aim of restructuring Iraq’s economic structure and reducing the country’s heavy dependence on oil revenues.

But the closure of the shipping route through the Strait of Hormuz exposed the structural limitations of the Iraqi economy. The cessation of oil exports caused a sharp decline in government revenues, and at the same time, years of political disputes have prevented the development of alternative oil export routes through Turkey, Syria, Jordan, and Saudi Arabia.

As a result, the Iraqi government is facing unprecedented financial pressure, which could also intensify its effects on the Kurdistan Region if the war drags on.For Erbil, the continuation or expansion of the war could turn the current security crisis into a deeper economic crisis, especially if the oil and gas production shutdown is prolonged or attacks on energy facilities continue.

Aland Karim Saleh, an economic researcher and vice president of the Vision Foundation for Strategic Studies, warned that a complete shutdown of oil exports could have catastrophic consequences for the Kurdistan Region.

 “If the war continues and becomes more widespread, it will cause huge damage to the energy sector, including oil and gas, and the damage could reach 100 percent,” he said.

Saleh also considered the shutdown of the Kormor gas field as a direct result of the attacks, saying that this situation has also affected the Kurdistan Region’s electricity supply.

Regarding the region’s oil production situation, he said: “Based on the agreement with the central government, 200,000 barrels of oil are to be exported daily.Now production has dropped to just 30,000 barrels. These figures change based on security developments.”

According to the researcher, the war has also exacerbated the region’s previous financial crisis. “The Kurdistan Region has been facing a financial crisis for years, and with the start of this war, its non-oil revenues have decreased by about 70 percent, a figure that does not even meet the basic needs of government agencies,” he said.

Saleh added that the economic consequences of the war have also spread to the housing market: “Even the real estate market has faced a 15-20 percent drop in prices as a result of the war.”

Concerns about the Kurdistan Region becoming a permanent battlefield

In the region’s main cities, including Erbil, Sulaymaniyah and Dohuk, the concern is not limited to missile and drone attacks.The escalation of the war has raised concerns that the Kurdistan Region, despite its efforts to stay out of the conflict, could become a permanent arena for settling scores.

For the Kurdistan Region, which is already grappling with a financial crisis, unresolved disputes with Baghdad, declining non-oil revenues and a vulnerable energy infrastructure, this situation could have consequences beyond the short-term damage of the war.

Al Jazeera concluded the report by saying: If the attacks continue and the crisis in the Strait of Hormuz also disrupts Iraq’s and the region’s oil exports for a long time, the region could face a combination of a security crisis, reduced investment, a drop in trade, disruptions in energy and a deepening financial crisis. Such a situation could also increase pressure on the regional government and its relations with Baghdad.