The decision comes amid heightened tensions between the U.S. and Iran as nuclear talks appear to have stalled.

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.

The State Department is reportedly ordering the departure of all nonessential personnel from the U.S. Embassy in Baghdad, Iraq. It will also authorize non-essential personnel to leave from other Middle East nations in the region.