Iraq stands firm against UN '\'smart sanctions'\'

Published July 4th, 2001 - 02:00 GMT

The Security Council voted unanimously on Tuesday, July 3, o extend the UN's humanitarian program n Iraq for five months, after backing away from a showdown over sanctions reform. 


A senior Iraqi official warned Tuesday that Baghdad could still refuse to resume oil exports if there is any mention of "smart sanctions" in a UN resolution, but OPEC leaders dismissed the threat. 


Key members of the OPEC oil-producing cartel vowed to do whatever is necessary to stabilize crude prices around their target price of $25 (€29) per barrel, whether Iraq resumes exports immediately or not. 


"We should see Iraq coming back within the next few weeks," OPEC president Chakib Khelil said after a formal meeting of the 11-member grouping in Vienna. "There's no doubt that Iraq will be coming back," he added. 


Iraq's representative at the meeting was less sure. "Iraq will reject any UN resolution if it contains mention of the US-British smart sanctions draft," said Saddam Hassan, head of the Iraqi national oil company Somo. 


But another Iraqi source, requesting anonymity, agreed that: "We hope to be back on the market as soon as possible." 


Iraq suspended its UN-administered exports last month in protest at the proposed smart sanctions. Britain and the United States agreed Monday to drop their proposals, after Russia objected. 


Hassan, pressed on whether Iraq was prepared to continue its suspension of exports, said: "It will have to be studied by the political authorities of Iraq. We don't know yet." He said Iraq would insist that the oil-for-food regime would only satisfy it if it remained "exactly as it was." 


But Saudi Oil Minister Ali Al-Nuaimi, OPEC's kingpin, said it was irrelevant whether or not Iraq resumes its exports, suspended last month. "It's not really relevant. We are focused on the market regardless of whether there is a shortage or a glut. We at OPEC will take the necessary steps to keep the price within the band." 


"We have the mechanism, the will and the capacity to act," he added, referring to an OPEC price-band mechanism designed to keep prices within a range of $22-$28 a barrel. 


The Iraqi official, standing in for Iraqi Oil Minister Amer Rasheed, made his comments as the UN Security Council was discussing extending the UN's humanitarian program in Iraq. In New York, the Council adjourned talks after about 90 minutes Tuesday, saying it was close to an agreement but "slight differences" remained. 


One Western diplomat said Britain was under pressure to drop wording from the draft reiterating the council's commitment to the principle of reforming its 11-year-old Iraqi sanctions regime. 


Iranian Oil Minister Bijan Namdar Zangeneh meanwhile expressed hope that Baghdad would soon resume its crude exports, suspended last month in a row over the proposed modification of the UN sanctions. "I do believe that Iraq will come back on the market very soon," he told reporters. 


Al-Nuaimi meanwhile reaffirmed the cartel's objective of keeping crude prices around $25 a barrel by automatically increasing or cutting production depending on price fluctuations. "The $25 price is a fair price for both producers and consumers," he said. "We have a target in mind, we have a band in place, we will take any action whenever necessary," he said. ― (AFP, Vienna) 


by Geraldine Amiel 


© Agence France Presse 2001

© 2001 Mena Report (

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