Iraq may halt oil flows unless paid in euros-paper

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Iraq may halt oil flows unless paid in euros-paper

October 12, 2000 3:44am Source: Reuters

BAGHDAD, Oct 12 (Reuters) - Iraq may halt oil exports unless a bank account holding its U.N.-monitored petroleum revenues is changed from dollars into euros, an Iraqi central bank official said in remarks published on Thursday.

``Iraq may resort to halting its crude oil exports if the United Nations refuses to allow it to open a bank account in the French bank in the euro currency,'' Abdulillah Putrus, deputy governor of the Central Bank, told the weekly al-Zawra.

``All oil (sale) contracts that Iraq is going to conclude with foreign parties should be paid in euros.''

The reported statement runs counter to an announcement by Iraqi Vice-president Taha Yassin Ramadan at an OPEC summit in Caracas on September 28 that Baghdad would not hold back its crude from the world oil market.

Oil officials were not immediately available for comment.

The newspaper is owned by Iraqi President Saddam Hussein's eldest son Uday.

Iraq's oil revenues generated from its oil sales under an oil-for-food deal with the United Nations are deposited in a U.N. escrow account in a French bank in New York.

U.N. sources said in May that the Banque Nationale de Paris account had a record $7.8 billion from proceeds of Iraqi oil sales under the U.N. ``oil-for-food'' programme.

The oil deal allows Iraq to sell oil over six months period in renewal bases to buy food, medicine and other humanitarian goods for the Iraqi people reeling under stringent U.N. sanctions imposed for Baghdad's 1990 invasion of Kuwait.

The Iraqi government decided late last month to halt trading with the dollar and replaced it with the euro or any other currency.

A statement by the Iraqi government after a September 14 cabinet meeting which originated the dropping of the dollar said the move was to confront the ``daily American-Zionist aggression.''

http://finance.individual.com/display_news.asp?doc_id=RTJ12a4388reuff&page=news

-- Martin Thompson (mthom1927@aol.com), October 12, 2000


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