Iraq to Stop Crude Oil Exports Mon. The Associated Press, Jun 2, 2001 : 5:29 am ET

BAGHDAD, Iraq -- Iraq said Saturday it will halt oil exports from its Persian Gulf and Mediterranean terminals starting Monday.

The announcement was made by the official Iraqi News Agency, quoting an Oil Ministry spokesman. The decision will take effect 8 a.m. local time, the agency added.

Iraq's move follows the U.N. Security Council's decision Friday to extend by one month the oil-for-food program under which Iraq exports oil and uses revenues to buy specific humanitarian goods under the international body's supervision.

"Iraq will stop oil exports under the oil-for-food program in light of the noncompliance of the Security Council with the spirit and minutes of the memorandum (oil-for-food program)," the spokesman said.

The Security Council's 30-day extension was made to give Washington and London more time to sell their so-called smart sanctions proposal to other U.N. Security Council members.

China and France said they need more time to study draft lists of military-related items that could be banned from Iraq under the British-proposed plan.

Iraq rejected the oil-for-food program extension and said it would not sign any new oil contracts over the next 30 days.

"The smart sanctions will not be a success. America's failure will be greater during the Security Council voting next month on the smart sanctions draft resolution," the daily Al-Iraq said Saturday.

The extension "will be a disaster on those who planned for it," the paper added in a front-page editorial.

The existing oil-for-food program allows Iraq to sell unlimited amounts of oil but strictly regulates how oil revenues can be spent. The program's current six-month phase expires Monday.

The smart sanctions proposal -- backed by Washington and rejected by Baghdad -- aims to allow the free flow of civilian goods into Iraq except for items that appear on a U.N. list of military-related items.

It also permits commercial and cargo flights in and out of Iraq, but requires they be inspected at their departure points. It is designed to tighten border controls around Iraq and to curb oil smuggling and illegal Iraqi surcharges.

Iraq has warned neighbors Jordan, Syria and Turkey that it would halt oil supplies to them if they accepted the smart sanctions proposal.

-- Anonymous, June 02, 2001

Answers

I don't think anything will make a dent in the amount of oil that Iraq smuggles out, provided Iran continues to allow it. And I don't think Iraq intends to stop smuggling this next month.

-- Anonymous, June 02, 2001

http://www.boston.com/dailynews/154/world/Iraq_says_it_will_live_witho ut:.shtml

Iraq says it will live without the oil-for-food deal

By Sameer N. Yacoub, Associated Press, 6/3/2001 08:12

BAGHDAD, Iraq (AP) Iraq went on the offensive Sunday over proposed changes to U.N. sanctions, saying it can live without the United Nations' oil-for-food program and vowing to take measures against countries that support the changes.

In a front page editorial, the ruling party newspaper Al-Thawra said Iraq lived six years between 1990 and 1996 without this ''lame program which covered only a small portion of Iraq's needs.''

Baghdad's stance follows its decision Saturday to halt all crude oil exports at 1 a.m. EDT on Monday. The decision was in reaction to the U.N. Security Council's decision Friday to extend by one month the U.N. oil-for-food deal.

The extension is intended to allow the United States and Britain more time to get Security Council backing for their so-called ''smart sanctions'' proposal.

The U.N. oil-for-food plan was set up in 1996 to help ordinary Iraqis cope with the effects of U.N. sanctions imposed to punish Iraq for its 1990 invasion of Kuwait.

''The Americans and the British are mistaken if they think that Iraq cannot live without this (oil-for-food) program and, consequently, it will accept anything imposed on it,'' Al-Thawra said.

The daily warned that ''all countries should care for their national interests, which shall be damaged if those countries get involved in the American-British game.'' It said Iraq would take ''whatever necessary measures'' against countries supporting the smart sanctions proposal.

Iraq has warned neighbors Jordan, Syria and Turkey that it would halt oil supplies to them if they accepted the sanctions proposal. Iraq has the world's second-largest reserves of oil after Saudi Arabia.

''Iraq halted its oil exports, and it is prepared to face the worst possibilities,'' the newspaper said.

Saudi Arabian Oil Minister Ali Naimi said Saturday the Organization of the Petroleum Exporting Countries was ready to cover any shortfall in world oil production following Iraq's decision to halt exports. Other OPEC nations are pumping at top capacity, but Naimi said Saudi Arabia alone is capable of covering any shortage.

OPEC Secretary General Ali Rodriguez played down the potential impact of a disruption in Iraqi oil exports.

''We'll cross that river when we come to it,'' he said.

It was not clear how long the Iraqi halt of oil exports would last.

Iraq's Al-Ithad weekly said on Sunday that the Oil Ministry's senior undersecretary, Taha Humud Musa, will head a high-level Iraqi delegation to OPEC's two-day meeting in Vienna starting Tuesday.

Baghdad is opposed to the smart sanctions proposal, which aims to allow free flow of civilian goods into Iraq except for items that appear on a U.N. list of military-related items.

It also permits commercial and cargo flights in and out Iraq as long as they are inspected at their departure points. It is designed to tighten border controls around Iraq and to curb oil smuggling and illegal Iraqi surcharges.

Iraq wants the lifting of all sanctions imposed on it, and it resents controls on its borders and imports.

Iraq produces about 3.2 million barrels of oil per day, of which about 2 million barrels per day has been exported under the U.N. oil- for-food program. Iraq also pumps for domestic consumption and under a separate, U.N.-accepted arrangement for supplying oil to neighboring Jordan.

-- Anonymous, June 03, 2001