New Delhi, April 4 -- Iraqi oil fields once alive with the buzz of workers are nearly deserted. Ports that pulsed with the churn of cargo have fallen still, the din of commerce replaced by the soft rhythm of waves.

A month after the war in Iran started, workers at ports and oil fields in the province of Basra, where almost all of Iraq's crude is produced and exported, have grown accustomed to rockets streaking across the sky, aimed at U.S. air bases and other strategic facilities.

The war, which began with U.S.-Israeli strikes, is dealing a heavy blow to Iraq's economy. Iraq relies on oil revenues for roughly 90% of its budget, and most of its oil is exported through the Strait of Hormuz, the narrow mouth of the Persian Gulf where Iran ...