The OPEC cartel's second-biggest crude producer had been left reeling by the recent worldwide crash in oil prices and a flood of cheap crude from Saudi Arabia.

To help boost prices, Iraq agreed to join an output cut deal between OPEC and its allies and dropped its exports in June to 84 million barrels, its lowest monthly sales in several years.

With prices inching up to $33 dollars a barrel, Iraq was able to bring $2.86 billion into its slim state coffers.

It represented a significant drop in sales from May's 99.5 million barrels, which at an average price of $21 earned it $2.09 billion.

Oil ministry spokesman Assem Jihad told AFP that the drop in exports was a sign of Iraq's commitment to the production cuts by OPEC and its allies.

"We had set a target of dropping exports to 2.8 million barrels per day (bpd) for June, and we reached that target," Jihad said.

"We faced a lot of pressure last month over our level of compliance, which was at 46 percent, but we are hoping to boost it even further for July," he added.

Jihad said the federal government had cut production at both state-run fields and those managed by global oil companies, but complained that the autonomous Kurdish region had not slashed its own output enough.

In April, the so-called OPEC+ alliance pledged to cut output by 9.7 million bpd for May and June.

To comply, Iraq was meant to slash its own daily production by around one million barrels to about 3.5 million bpd.

It missed that target in May but put the blame mostly on the Kurdish regional government (KRG) in the north, which sells its oil independently.

Iraq is in talks with the KRG to resolve longstanding oil and budget disputes but they have yet to yield results.

Low revenues have been catastrophic for Iraq, which relies on oil sales to fund more than 90 percent of its budget.

Each month, it needs about $4.5 billion to pay salaries, pensions, welfare handouts and other government expenses.

The government is the country's biggest employer, with at least four million people on its payroll and another four million who receive pensions or social benefits.

In a bid to reduce expenses, Iraq has asked international oil companies to cut down on their costs, which are reimbursed quarterly by the Iraqi government.