Rising tensions with Iran and fears of an Israeli strike prompted the U.S. to move some of its nonmilitary personnel out of the region.

The price of oil initially increased more than 4% when news of the US evacuation broke, in anticipation of regional insecurity potentially leading to supply problems. Around 2,500 US troops are based in Iraq, according to the defence department.

Tensions in the Middle East are also rising due to Israel ’s war on Gaza. Israel and Iran exchanged fire twice last year – the first direct attacks between the region's most entrenched enemies – with missiles and war drones hurtling across Iraqi airspace.