An escalation in the Middle East could put Iraq at the forefront of economic damages caused by the closure of the strait of Hormuz, Iraq’s only pathway to the global market, an advisor to the Iraqi prime minister told The New Region.

“The possibility of a serious conflict in the Middle East and the Gulf particularly means that our country, Kuwait, Bahrain, and Qatar will be at the forefront of countries affected by the strait of Hormuz,” Economic Advisor to the Iraqi Prime Minister Mudher Mohammed Salih told The New Region.

Salih said that currently, 100 percent of Iraqi exports goes through the strait of Hormuz to the global market, and the closure of the strait even temporarily could deal a lot of damage to the Iraqi economy.

The world is anticipating a strong Iranian response to the killing of Hamas leader Ismail Haniyeh. Tehran has vowed to have a strong response and an Iranian attack could happen at any minute.

Axios on Monday reported that US Secretary of State Antony Blinken had told G7 allies that an Iranian attack could take place as early as Monday. This has raised fear that an Iranian attack on Israel could trigger an all out war in the region.

Iran’s Foreign Ministry spokesperson Nasser Kanaani on Monday told reporters that Tehran considers defending its national security, sovereignty and territorial integrity as a decisive and indisputable right, and “no one has the right to doubt Iran's legal right to punish the aggressor.”

According to Salih, while countries like Saudi Arabia, UAE, and Oman have other routes to access the global market, they too will be no exception to the negative impacts of a war that could deprive the world of around 40 percent of its oil supply.

An escalation will lead to “an energy crisis and a sudden rise in oil prices to record levels on the one hand, and a crisis of financial resources for the oil-producing and exporting countries on the other hand,” Salih said.

Iraq has long relied solely on the strait of Hormuz to export its oil to the rest of the world and with the Iraq-Turkey pipeline that used to transport the Kurdistan Region’s oil and oil from Kirkuk to the global market through the Ceyhan port still closed down, the country will be left with no exit for its oil.