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News: Half of Iraq's oil export capacity at a standstill; more on spying and UNSCOM

*       Iraqi oil pumping to Turkey stopped (Arabic News)
*       Iraq: U.S. Strikes Jeopardize Oil (Associated Press)
*       UN 'kept in dark' about US spying in Iraq (The Guardian)
*       US threat to Saddam over air attacks (Daily Telegraph)
*       British-Syrian disputes over Iraq (Arabic News). The British
ambassador to Damascus: "We agree with the Syrians on the importance of
doing our best to ensure best conditions for the Iraqi people."

Iraqi oil pumping to Turkey stopped
Arabic News, Iraq, Economics, 3/2/99

The pumping of Iraqi oil to Turkey continued to be halted on Monday due
to the damage Iraq said was inflicted on the oil pipelines as a result
of the US air strikes on Sunday. The official in charge of planning at
the Iraqi Oil Ministry, Faleh Hassan al-Khayat, said that it is still
too early to resume exports despite the fact the pipeline transports
half of the Iraqi oil exports. He indicated that the Iraqi authorities
are currently evaluating the damage resulting from the raid launched by
US planes on Sunday on the station for monitoring the operation of the
Iraqi-Turkish oil pipeline in northern Iraq, noting that the raid
resulted in killing or wounding several Iraqis. Iraqi - Turkish oil
pipelines link Karkouk oil fields, 255 km north of Baghdad, with the
Turkish port of Jeihan on the Mediterranean Sea.

Iraq: U.S. Strikes Jeopardize Oil 
By Leon Barkho, Associated Press Writer, Tuesday, March 2, 1999; 5:06
p.m. EST

AIN ZALA, Iraq (AP) -- About half of Iraq's oil exports are in jeopardy
after U.S. warplanes hit two communications centers that controlled the
flow of oil through a key pipeline, an Iraqi official said Tuesday.  The
damage from the strikes Sunday and Monday is so extensive that it will
take a ``long time'' to resume pumping oil through the pipeline to
Turkey, Hussein al-Fattal, head of operations for Iraq's Northern Oil
Company, said.  Officials tried to pump oil on Monday but failed,
al-Fattal said. ``We tried ... but we lost communications and control,''
he said. 

The U.S. military has said American planes may have hit several sites in
northern Iraq, but it was not sure if the targets had anything to do
with the pipeline.  British and U.S. planes have been striking Iraqi
targets almost daily since late December. The allies say they are
responding to Iraqi threats to its planes in ``no-fly'' zones over
northern and southern Iraq. Iraq does not recognize the ``no-fly''
zones, which were set up to ensure that Iraqi forces do not target
Kurdish rebels in the north and Shiite opposition in the south. 

In Washington on Tuesday, White House spokesman David Leavy said, ``Our
pilots are going to enforce the no-fly zone; they are going to take the
necessary precautions to do that ... What they're targeting is what they
deem threatens their ability to carry out the mission.''  Al-Fattal and
other Iraqi officials have denied the two centers hit ever were used for
military purposes. Al-Fattal said the centers functioned as an oil relay
station, carrying signals between Iraq and Turkey, and was used to
maintain contact between branches of the company in the area.  The
pipeline carried about half of Iraq's oil exports. Al-Fattal estimated
the damage has cost Iraq at least $2.5 million. 

Iraqi oil exports were banned under U.N. sanctions imposed in 1990 after
its invasion of Kuwait but limited sales were resumed under a U.N.
program that started in December 1996. Iraq is now allowed to sell oil
every six months to finance its food and humanitarian purchases.  In the
current six-month phase, Iraq may sell $5.2 billion worth oil, or about
2.1 million barrels a day. However, the dilapidated state of its oil
industry has made it difficult to reach that target.  In New York, the
United Nations issued a statement saying it was ``deeply concerned''
about the strikes and said any extended stoppage will limit funding for
the program. ``Given the depressed price of oil and the state of Iraq's
oil industry, there's currently a $900 million gap between the revenue
expected and what's needed to fund the humanitarian program,'' said
Benon Sevan, the executive director of the U.N. oil-for-food program.

The Guardian: UN 'kept in dark' about US spying in Iraq,
By Julian Borger in Washington, Wednesday March 3, 1999 

American espionage in Iraq, under cover of United Nations weapons
inspections, went far beyond the search for banned arms and was carried
out without the knowledge of the UN leadership, it was reported
yesterday.  An investigation by the Washington Post found that CIA
engineers working as UN technicians installed antennae in equipment
belonging to the UN Special Commission (Unscom) to eavesdrop on the
Iraqi military. When British intelligence asked what was going on, the
operation was denied, the report said. US government officials refused
to comment on the report yesterday. 

In response to newspaper allegations of espionage in January, the US
conceded that it had deployed eavesdropping equipment in an operation
codenamed Shake the Tree, but insisted that it was done at the
invitation of Unscom with the sole aim of foiling Saddam Hussein's
attempts to conceal weapons of mass destruction.  But according to
yesterday's report, quoting unnamed US sources, the "remote monitoring
system" Unscom used to relay video pictures of suspected weapons sites
to inspectors in Baghdad was secretly used to intercept communications
between Iraqi commanders and military units. Richard Butler, the
Australian diplomat who runs Unscom, was reportedly kept in the dark
about the CIA operation, as was his predecessor, Rolf Ekeus.

But the Washington Post quoted "sources in Washington" as saying that
the CIA notified Charles Duelfer, a US official who served as deputy to
both Mr Ekeus and Mr Butler, to ensure that Unscom inspectors in Iraq
did not interfere with the operation. On hearing of the Washington Post
story, Mr Butler was reported to have exclaimed to a colleague: "If this
stuff turns out to be true then Rolf Ekeus and I have been played for
suckers, haven't we?"

Ewen Buchanan, spokesman for Unscom, said yesterday that Mr Butler had
made no official response to the Washington Post allegations. But he
questioned whether the alleged eavesdropping would have been possible.
"I don't know if it was technically feasible," he said. "Those repeater
stations [used in the Unscom video-monitoring programme] are out in the
middle of nowhere. They're there for anyone to go and tinker with.
Wouldn't the Iraqis have been able to tell what was going on?" he asked.
The UN secretary-general, Kofi Annan, said he "personally had no direct
knowledge" of the allegations.

In a book due to be published next month, a former US Unscom inspector,
Scott Ritter, is expected to confirm that CIA agents infiltrated the UN
inspection teams. Mr Ritter resigned from Unscom last year, complaining
that the US was undermining its work by ordering inspections to be
reined in to avoid military confrontations at politically inconvenient
moments. Iraqi officials said the report vindicated their claims that
Unscom was a front for US and British spies.  According to yesterday's
report, Unscom technicians occasionally noted "burst transmissions" but
were unable to identify their source. But an Iranian spy in Baghdad was
more successful and signalled back to Tehran a message saying that the
US was running an electronic espionage operation within Unscom. British
intelligence intercepted the Iranian message, but when it asked the US
National Security Agency for an explanation in May 1997, the NSA gave
none."We don't tell the British everything, even if they are our closest
intelligence ally," the Post quoted one US official as saying. 

Unscom weapons inspections collapsed in December, when US and British
planes carried out Operation Desert Fox. By then, according to
yesterday's report, the clandestine eavesdropping network had already
been abandoned.

The Daily Telegraph: US threat to Saddam over air attacks
By Hugo Gurdon in Washington, 3 March 1999

AMERICAN forces will wipe out Iraqi air defences in the no-fly zones if
Saddam Hussein continues trying to shoot down air patrols, Washington
said yesterday. The Pentagon, a day after the heaviest allied attacks
since Operation Desert Fox in December, said: "Monday's strikes should
make it clear that tit-for-tat is over. The number of bombs and range of
targets is growing." Clearly, Washington and London have grown weary of
Saddam's constant efforts to gain a propaganda victory by shooting down
at least one of the aircraft enforcing the no-fly zones imposed after
the Gulf war to stop his attacks on the Kurds.

The warning to Baghdad came as the White House refused to deny a report
that CIA spies were infiltrated into United Nations weapons inspection
teams three years ago to eavesdrop on Saddam's military. Citing secret
documents and information from unidentified officials, the Washington
Post reported that Saddam was right, and that Washington had for years
abused the international surveillance regime. America knew it could
undermine the UN Special Commission and calculated, correctly, that the
risk of detection was slight, officials told the paper. Richard Butler,
head of the UN Special Commission, Unscom, denied that his teams
exceeded their mandate or included spies.

It has been reported that CIA agents fixed the Unscom equipment to
monitor microwave communications from generals to infantry in the field
via Iraqi radio masts. Mr Butler's teams had video cameras fixed in
remote sites to keep an eye on weapons development. In 1996 the pictures
began transmitting to Unscom headquarters in Baghdad, using radio
signals boosted by relay stations. Without telling Unscom, the CIA made
sure the relay stations were installed by its agents, who hid antennae
in them to intercept the military communications. They told Unscom so
little about their "maintenance" work that it provoked a clash with the
commission's director of operations, Col James Moore, who was recalled
to Washington.

British-Syrian disputes over Iraq
Arabic News, Syria, Politics, 3/2/99

The British ambassador in Damascus, Basil Eastwood, has expressed hope
to reach with Britain's "Arab friends a means of avoiding us the use of
power in Iraq." He indicated "Syrian-British disputes over means of how
to deal with the Iraqi issue," noting that Iraqi President Saddam
Hussein "is a problem for all of us." In a speech he gave on Monday in
the central Syrian city of Homs, Eastwood said, "There are political
disputes between us and the Syrian government," adding, "but the points
which we agree upon are much greater those we differ on." Eastwood added
that the points of agreement between Damascus and London cover the "need
of implementing UN Security Council resolutions and urge Iraq to abide
by them." He commented, "But we differ on how we achieve that." The
British ambassador added, "We agree with the Syrians on the importance
of doing our best to ensure best conditions for the Iraqi people."


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