Iraq is caught in the crossfire of the Iran war, with attacks by both sides on its soil

Unlike other Middle Eastern states touched by the war, Iraq hosts both entrenched Iran-aligned forces and significant U.S. interests. As in past upheavals, Iraqis have learned to adapt to daily violence that intrudes on everyday life.

But Iraq’s economy depends overwhelmingly on oil, so the longer the conflict lasts, the greater the risk that economic shocks, political paralysis and friction with Iran‑backed militias will combine to unravel Iraq’s hard‑won relative stability.

The government might not be able to meet its oversized public‑sector payroll as soon as next month, risking widespread unrest, two Iraqi Kurdish officials said.

In the meantime, a parallel conflict to the wider war has escalated between Iran-backed Iraqi militia groups and the U.S. — near-daily drone strikes have targeted American interests across the country, while the U.S. has struck back against militia bases to defend its troops.  — AP