Ignoring a threat by Iraq to disrupt its oil-for-food program, the Security Council on Friday, June 1, formally endorsed the principle of reforming the 11-year-old UN Iraqi sanctions regime.
The council adopted a resolution to extend the program by one month instead of the usual six months, and said that by July 3 it would "consider new arrangements" for the trade embargo on Iraq.
The resolution "expressed its intention to adopt and implement such new arrangements" on July 4 for an initial period of 190 days. All 15 council members voted for the resolution.
The text said the new arrangements would "improve significantly" Iraq's ability to import civilian goods, while tightening controls on prohibited arms sales. They would also "prevent the flow of revenues to Iraq" from smuggling outside the oil-for-food program.
Iraq, which is believed to earn about $1.5 billion a year from illegal oil sales, said earlier Friday that it rejected the resolution, and described it as "still-born".
Deputy Prime Minister Tareq Aziz said the sanctions reforms proposed by Britain and the United States would "harm not only Iraq but all the partners of Baghdad among its friends and brothers".
The official news agency INA said Aziz met the Chinese, Russian and Tunisian ambassadors in Baghdad to inform them of Iraq's stand. Aziz, who is also Iraq's acting foreign minister, did not spell out when Iraq might retaliate by cutting its crude oil exports under the oil-for-food program.
On Thursday, Iraq's ambassador to the United Nations, Mohamed Al-Douri, told reporters that "Iraq will not conclude any oil contracts" based on the one-month extension. But he said it would "honor all existing contracts" ― a rider that took the sting out of the threat, since Iraq has outstanding commitments to ship almost 300 million barrels of crude, equivalent to about 135 days exports at last week's rate of just over 2.2 million barrels a day.
Despite the Iraqi statements, the price of crude oil fell slightly on international markets Friday. In London, a barrel of Brent North Sea crude for July delivery slipped to $29.07 from $29.34 at the close on Thursday. New York's light sweet crude July contract closed the session on Thursday down 18 cents at $28.37 a barrel.
"There is some concern about Iraq withdrawing its exports," said ABN Amro oil broker Richard Bend in London. "But I think it's going to be sorted out." ― (AFP, UN)
© Agence France Presse 2001
© 2001 Mena Report (www.menareport.com)