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Sunday, July 5, 1998 Published at 00:23 GMT 01:23 UK


World: Middle East

Iraqi oil production at "critical" levels

The UN Security Council voted to allow Iraq to export limited amounts of oil

Iraq's oil production is at "critical levels" and Baghdad may not be able to fund the latest UN oil-for-food programme, which is meant to buy humanitarian supplies.

The country's oil minister, Amer Mohammad Rashid, said oil production was at a "very critical level" due to a lack of spare parts.

Iraqi oil production is about 1.7 million barrels per day, but this could rise to two million bpd if 40 spare parts contracts are approved by the UN committee supervising the embargo.

Under a special arrangement designed to mitigate the effects of UN sanctions, Iraq is allowed to sell a limited amount of oil to buy food and medicine.

The programme's executive director, Benon Savan, who has just completed to a visit to Iraq, said he was also concerned about a slump in the international oil price, which has halved in the last 18 months.


[ image: Benon Sevan...gloomy about Iraqi oil production]
Benon Sevan...gloomy about Iraqi oil production
Mr Sevan said Iraq was unlikely to be able to export enough oil to fund the latest $2.8bn humanitarian aid programme and he said tough choices would have to be made on priorities.

Earlier this year, the UN agreed to a major increase in the oil for food agreement to allow Baghdad to buy extra humanitarian supplies and combat growing malnutrition and disease.

But the dilapidated Iraqi oil industry desperately needs an estimated $50m worth of spare parts.

The UN Security Council has approved the purchase of the equipment but individual contracts still have to be scrutinised by the UN sanctions committee to make sure none of the parts can be used for military purposes.

During his visit, Mr Sevan has also been addressing complaints about the distribution of aid, especially from Kurds in northern Iraq.





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