The export decline has been going on for some time.

True, those pissed off at France for demanding proof of WMDs before supporting an Iraq invasion are even more pissed off that they were right, but I doubt they were heavy drinkers of French wines in the first place. Iraq is sure to have had some effect, but I doubt it's large, and it's certainly not likely to have caused the huge decline in consumption within France.

Biggest problem is that California and Australia are mighty marketing machines that know how to move product in massive quantity, while the French wine industry is hampered by ancient laws and regulations outdated a century ago. They badly need the export market but are ineffective there.