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News clippings: October 4-11 Highlights This Week -------------------- * Iraq accuses US of blocking $750m worth of trade contracts related to sewage and water plant treatments. * US rejects speculated Iraqi deal offer to allow inspectors back into country in exchange for easing of sanctions. State department official says, ``We are not interested in talking to Iraq." James Rubin says, ``The Iraqis regularly seek to have discussions with American officials, and we're not interested in those discussions.'' * Security Council allows Iraq to exceed $5.26 billion oil export ceiling until November 20. * US bombs area west of Mosul. * Russian minister accuses countries of sanction-busting. He says that Russia will not be able to stop LUKOIL from ignoring sanctions. LUKOIL is Russia's biggest oil producer. I'm struggling to find UK related news items. If anyone finds UK-Iraq articles of interest, please let me know. Regards Nathan Geffen ------------------------------------------------------- Monday October 11, 2:46 pm Eastern Time Oil Output Limits Said Weakening By BRUCE STANLEY AP Business Writer LONDON (AP) -- Iran, Iraq and several other OPEC members boosted their crude oil output in September, increasing global supplies at a time when wealthy nations are consuming less oil than expected, according to a respected survey released Monday. However, possible signs of a softer market -- and cheaper petroleum prices -- are being offset by an anticipated strong growth in demand for heating oil this winter, the International Energy Agency disclosed in a monthly report. The report was compiled before last week's sharp reversal in world oil prices, when profit-taking and fears of weakening OPEC resolve to keep oil production under control triggered a 16 percent plunge in prices for crude contracts for future delivery on the New York Mercantile Exchange. David Knapp, the economist who edited the survey, said the sudden drop in prices did not change the agency's conclusions that the markets are still strong. Speaking by phone from his Paris headquarters, he predicted that global markets would remain firm on the back of an expected 3 percent rise in fourth-quarter demand to 77.2 million barrels per day. The IEA is part of the Organization for Economic Cooperation and Development, a group of the world's most developed nations. Knapp said the biggest surprise in the report was that oil inventories in industrialized countries actually increased from June to September. Iran led the increase in production, pumping an additional 190,000 barrels of oil per day, while Iraq boosted output by 60,000 barrels daily. Some industry analysts challenged the IEA's data, however, calling it puzzling and inconsistent. Peter Hitchens of London brokerage Williams De Broe said the IEA's finding on oil inventories was a ``glaring error,'' and he noted alternative surveys that showed decreases in oil stockpiles in the United States, Europe and Japan. But these analysts concurred with the IEA's basic conclusion that the market was still firm despite the recent drop in crude prices and a lower level of compliance with OPEC output quotas. Crude prices peaked last week in New York at a 33-month high of $25.12 per barrel, but had tumbled to $20.90 by late Friday. In New York, November contracts for U.S. benchmark West Texas Intermediate were trading slightly lower Monday at $20.85 per barrel. In London, November contracts for North Sea Brent were trading late Monday at $20.47 per barrel, down 23 cents per barrel from Friday. Analyst Mark Redway blamed the price reversal on speculators who had bet that OPEC would stick to its quotas. When market sentiment changed, they panicked and closed out their long positions, causing a sharp retreat in prices, said Redway of London-based brokerage Greig Middleton and Co. Ltd. Last week's price volatility was a ``blip,'' said Peter Gignoux, who manages the petroleum desk in London at U.S. investment bank Salomon Smith Barney. ``Is OPEC falling apart at the seams? No. Have they lost the will to make the production cuts stick? No,'' Gignoux said. ``The price of crude had built up such a head of steam that if it didn't have a pause, the price would have been shooting toward $30 a barrel now.'' U.S. gas prices, which have on the rise for the past six months, enjoyed at least a temporary reprieve as a result of the cheaper crude, said Trilby Lundberg, director of the Lundberg survey of 10,000 gasoline stations across the United States. The weighted average nationwide on Friday was $1.3288, down .53 cents per gallon from a Sept. 24 survey. The IEA reported that OPEC was 86 percent compliant with the production cuts agreed that its members agreed to in March and reconfirmed in September. OPEC's compliance rate for August was 94 percent, revised upward from 92 percent, the agency said. Given OPEC's record of cheating on quotas, analysts agreed that the group's compliance rate was still good even at its reduced level. In total, OPEC produced 26.43 million barrels a day last month, up 420,000 barrels from August, the IEA said. ``Given the recent higher prices, everyone tries to sneak in a few more barrels,'' said Hitchens. Yet last week's plunge in prices could work to the advantage of OPEC and other oil producers, by highlighting the fragility of the market and providing an incentive for renewed discipline, he added. ------------------------------------------------------------------------------- Friday October 8 3:52 PM ET U.S. Rejects Iraq Attempt At Direct Dialogue WASHINGTON (Reuters) - The U.S. will reject any attempt by Iraq to establish direct dialogue about easing sanctions, a State Department official said Friday. The spokesman was referring to news earlier this week that Jordan's King Abdullah would deliver a message from Iraq's Deputy Prime Minister Tareq Aziz when the king meets President Clinton and Secretary of State Albright in Washington on Oct. 12. ``We are not interested in talking to Iraq. We are interested in Iraq complying with U.N. Security Council resolutions and any discussion about that will be done through the Security Council,'' the State Department official said. Iraq has in the past been rebuffed when it tried to talk directly to the U.S., the strongest and most important opponent of any easing of comprehensive Gulf War trade and political sanction. The sanctions cannot be lifted until Iraq has complied with all U.N. Security Council resolutions including a clean bill of health from the U.N. certifying that it has destroyed all of its programs to build and deliver weapons of mass destruction. The official said Washington's policy toward Iraq remains one of ``containment followed by a change of regime.'' ``The Americans at this time are not going to deal with the Iraqis,'' said Raad al-Kadiri, an Iraq specialist at consultants Petroleum Finance Corp. in Washington D.C. ``There is a clear recognition from Baghdad that the Americans are the players that Iraq needs to turn around if it is going to get any significant progress in terms of the regime's rehabilitation,'' al-Kadiri added. The U.S. official said it wasn't clear what was in the message. But there has speculation in political circles that Iraq offered a deal to allow weapons inspectors back into the country. The inspectors left Iraq last December after a series of confrontations with Iraqi officials. The speculation is that Iraq is asking for further easing of sanctions which would allow it to develop its oil industry unfettered. Currently, Iraq can export oil, which accounts for virtually all of its foreign earnings, under the stringent ''oil-for-food'' program, administered by the U.N. Though the rules have been eased since the program began nearly three years ago, effectively allowing Iraq to pump oil at current capacity. But Iraq has the potential to produce much more oil if foreign oil companies were allowed to come in and develop vast fields. Iraq has favored companies from Russia, France and China with oil concessions for giant new fields. But while these countries -- powerful permanent members of the Security Council -- have put pressure on the U.S. to support easier sanctions, Iraq is only allowed under the rules to spend a limited amount of its oil revenue on fixing its dilapidated oil infrastructure and is not allowed to develop the new fields. --------------------------------- Friday October 8 11:25 AM ET Report: Iraq Executed 11 Prisoners CAIRO, Egypt (AP) - Iraq has executed 11 political detainees in a prison near Baghdad, a human rights group affiliated with an Iraqi opposition party claimed Friday. The Center for Human Rights said the executions took place Sept. 23 in Abu Ghraib prison, just west of Baghdad. The group, which is linked to the Iraqi Communist Party, cited unidentified sources inside Iraq as providing the information. President Saddam Hussein's government refuses to comment on such accusations and there is no way to get independent confirmation. The Center for Human Rights, based in Shaqlawa in northern Iraq, provided a list identifying the prisoners it said were executed. All of them had been detained since an abortive Shiite Muslim uprising in southern Iraq after the 1991 Gulf War, it said. In March, former Dutch Foreign Minister Max van der Stoel, who is a U.N. human rights representative to Iraq, said hundreds of executions took place in 1998 as part of an Iraqi prison cleansing campaign. Since late 1997, he said 2,500 prisoners had been put to death. ----------------------------------------------------- Thursday October 7 10:11 PM ET Iraq Says U.S. Blocking Contracts By LEON BARKHO Associated Press Writer BAGHDAD, Iraq (AP) - Iraq's trade minister accused the United States on Thursday of holding up $750 million worth of contracts that would have greatly improved the health of millions of malnourished Iraqi children. Mohammed Mehdi Saleh told reporters that the blocked contracts were related to water and sewage treatment plants which have crumbled during more than nine years of U.N. trade sanctions imposed on Iraq for invading Kuwait in 1990. Saleh claimed the United States is deliberately impeding contracts for central and southern parts of Iraq, home to more than 20 million people. He said similar deals involving the Kurdish northern Iraq, which has a population of 3.3 million, are not hindered. The government handles the purchase and distribution of humanitarian supplies under the U.N.-approved oil-for-food deal in central and southern Iraq. In the Kurdish North, the program is the responsibility of the United Nations. A survey by the United Nations Children's Fund in August reported a dramatic increase in malnutrition and deaths among Iraqi children in the heavily populated southern and central Iraq, while there was a significant drop in the Kurdish north. UNICEF also reported that at least 40 per cent of water samples it examined in government-controlled areas were found to be contaminated. Saleh said the United States did not want the situation to improve in central and southern Iraq in order ``to show that the Iraqi government is not capable of implementing the program as it is happening in the North.'' U.N. officials overseeing Iraqi contracts and purchases under the oil deal declined to comment on Saleh's remarks. ---------------------------------------------- Thursday October 7, 6:00 pm Eastern Time Russia, Iraq Sign Oil Deals MOSCOW (AP) -- Iraq has signed contracts with Russian companies to supply oil production equipment worth $57 million, a top Russian official said Thursday. The deals were signed during a recent visit by a Russian delegation to Baghdad, Fuel and Energy Minister Viktor Kalyuzhny was quoted as saying by the Interfax news agency. He didn't name the Russian companies or provide any other details on the contracts. Iraq has also asked Russia to prepare a contract for pumping water to the Qurna oil field, the report said. The sides also prepared a deal on the joint drilling of 100 wells in the Northern Rumeila oil field. Russia has provided food and equipment for oil production worth hundreds of millions of dollars to Iraq under a food-for-oil program, the only exception to U.N. sanctions imposed after Iraq's 1990 invasion of Kuwait. Russia has been the leading buyer of Iraqi oil even though it is itself one of the world's largest oil producers. Russia hopes that its efforts will be rewarded when sanctions are lifted against Iraq. Iraq owes billions of dollars to Moscow, mostly for weapons purchased in the 1980s, and Russia would like to get at least some of that money back through contracts to rebuild Iraq's oil industry. -------------------------------------------------------- Thursday October 7 5:14 PM ET U.S. Using Concrete Bombs on Iraq By SELCAN HACAOGLU Associated Press Writer ISTANBUL, Turkey (AP) - U.S. warplanes have been dropping bombs filled with concrete and not explosives in raids on Iraqi installations in a move to minimize civilian casualties, a military official said Thursday. The 2,000- to 3,000-pound laser-guided bombs are still capable of causing damage, especially when dropped from high altitudes by a speeding jet, said Lt. Col. Michael Waters, a spokesman for Operation Northern Watch, the allied effort to patrol a no-fly zone over northern Iraq. ``If you drop it on a radio, it could break the radio without blowing up,'' Waters said. The new bombs were introduced following Iraqi allegations that the constant bombings by U.S. jets in response to Iraqi anti-aircraft fire were causing civilian casualties. ``We are extremely careful about collateral damage,'' Waters said. ``We have used those bombs.'' Army Gen. Henry Shelton, chairman of the Joint Chiefs, said Thursday in Norfolk, Va., that U.S. forces have been using concrete bombs for a long time. He declined to discuss how much or under what circumstances they were being used in Iraq. He said, however, ``If we have a target, a specific target that we are very concerned about collateral damage, but it's very important that we hit that target, that is a technique that we have of going after it.'' Operation Northern Watch warplanes are based at Incirlik air base in southern Turkey. U.S. and British planes have been patrolling no-fly zones over northern and southern Iraq since the 1991 Persian Gulf War to protect Kurdish and Shiite minorities from the forces of Iraqi President Saddam Hussein. The concrete-filled bombs would also cut the cost of the operation. American and British pilots often drop bombs a few times a week, responding to Iraqi challenge. They use anything from $12,000 laser-guided bombs to $80,000 Maverick missiles. Since December, when Baghdad started challenging the allied planes, warplanes have dropped more than 1,400 bombs and missiles on targets in northern and southern Iraq. U.S. officials say missiles have hit more than 375 military targets, including radar sites and anti-aircraft weapons. Iraq claims nonmilitary facilities are being hit and hundreds of civilians have been killed. U.S. authorities say civilian damage has been minimal and most of what the Iraqis claimed as casualties were military casualties or false reports. -------------------------------------------------- Thursday October 7 1:27 PM ET Hussein Offers U.S. Olive Branch By JOHN HALABY Associated Press Writer AMMAN, Jordan (AP) - Iraqi leader Saddam Hussein has sent a message to President Clinton, promising major political reforms in Iraq and offering to stop threatening Israel, a leading Arabic newspaper reported today. Administration officials, however, doubted that Iraq would make a serious overture to the United States through Abdullah. ``The Iraqis regularly seek to have discussions with American officials, and we're not interested in those discussions,'' the State Department spokesman James P. Rubin said Wednesday. The London-based Al-Hayat newspaper said the message includes an offer for unconditional talks with the United States and assurances that Iraq will play an effective role in the Middle East peace process. The message is being carried by Jordan's King Abdullah II, who is scheduled to meet with Clinton on Tuesday in Washington. Before leaving for London on Wednesday en route to Washington, Abdullah confirmed to Jordanian reporters that he was carrying a message from Saddam to Clinton. He refused to give details. ``I can't comment on that, but I have a message to pass on,'' Abdullah was quoted as saying by Jordanian newspapers today. If the Al-Hayat report is correct, it would mark a major turnaround in Iraq's hard-line policies and show a willingness to mend fences with its main enemies, the United States and Israel. In return, Iraq wants Washington to drop its threats to put Saddam and his senior aides on trial as war criminals, Al-Hayat said. Iraq's change of heart could also be linked to its demand that the United States drop its opposition to the lifting of U.N. economic sanctions, imposed in 1990 after Saddam's forces invaded Kuwait. Al-Hayat said the Iraqi leadership expressed readiness to start political reforms that would include a new constitution, adopting a multiparty system and respect for human rights. Iraq has been ruled by the Baath Party for the last 31 years, 20 of them under Saddam, whose tight control on power and intolerance for dissent have driven most opponents out of the country. In his message, Saddam also proposed providing guarantees that it will ``play an effective role in the (Middle East) peace process and stop its threats against the Jewish state and neighboring countries.'' Jordanian newspapers quoted Abdullah as saying the message was handed over by Iraqi Deputy Prime Minister Tariq Aziz to Jordanian Prime Minister Abdur Ra'uf S. Rawabdeh last week. Abdullah said he intends only to deliver the message and not speak on behalf of Iraq. Asked if he will defend Iraq before U.S. officials, he said: ``Absolutely not.'' Jordanian and Iraqi officials refused to elaborate on the contents of the message. ----------------------------------------------------- Wednesday October 6 10:14 AM ET U.S. Planes Bomb Iraqi Missile Site ANKARA, Turkey (AP) - U.S. warplanes patrolling the no-fly zone over northern Iraq bombed a missile site Wednesday after Iraqi gunners opened fire on the aircraft, the U.S. military said. The planes bombed a surface-to-air missile site west of the city of Mosul, the U.S. European Command said in a statement. Mosul is 250 miles north of Baghdad, the Iraqi capital. The attack came after Iraqi forces east of Mosul fired on the jets, the statement said. None of the planes was hit. The aircraft are based at Incirlik air base in southern Turkey. U.S. and British planes have been patrolling no-fly zones over northern and southern Iraq since the 1991 Gulf War, to protect Kurdish and Shiite minorities from the forces of Iraqi President Saddam Hussein. Iraq regards the zones as violations of international law and has challenged the allied planes frequently since December. ------------------------------ Wednesday October 6, 5:49 am Eastern Time Russian oil firms must work in Iraq -Fuel Minister MOSCOW, Oct 6 (Reuters) - Private Russian oil companies may start developing Iraqi oilfields despite United Nations sanctions, Russia's Fuel and Energy Minister Viktor Kalyuzhny was on Wednesday quoted as saying. ``We have agreed that within two months Russia will make public its position,'' he said in an interview with Vremya MN newspaper after returning from talks with Iraqi authorities. ``But my opinion is that (Russian) oil companies must work in Iraq.'' Kalyuzhny on Friday told reporters in Baghdad that the U.N. sanctions posed problems in implementing a deal signed two years ago with Russian firms to develop large oil reserves in Iraq. The Russian minister, who said his country maintains strategic relations with Iraq, made it clear in Baghdad that Russia would respect the U.N. sanctions. ``We will deal with Iraq in accordance with current existing circumstances,'' he said. But in the Russian newspaper, he was quoted as saying the government could not prevent private oil firms like LUKOIL , where the state had just a 28 percent stake, from intensifying cooperation with Iraq if it decided to ignore the sanctions. ``It is the right of LUKOIL's management to decide where to work,'' Kalyuzhny said. ``Why give away a delicious morsel?'' In 1997, LUKOIL, Russia's largest oil producer, and a number of other Russian companies signed a contract to develop Iraq's West Qurana oilfield. But the development of the field could not get started due to sanctions imposed on Iraq by the U.N. Security Council following Iraq's 1990 invasion of Kuwait. Iraqi officials have expressed displeasure over the failure of Russian companies to fulfil their obligations and have even raised the prospect of revising the contract. ``Today, everybody is profiteering with Iraqis, including countries which defend the embargo,'' Kalyuzhny said. ``It is Russia which suffers most, as it is unable to repatriate huge amounts of money, billions it has invested, which have been frozen.'' He said that the United States, with its control of the oil business, was taking advantage of the situation. He also said sanctions were being violated by Turkey, Algeria and ``to some extent'' by India. ``Turkey buys crude oil and oil products from Iraq -- and does so in front of American observers who are keeping a close watch on Russia instead.'' ``By closing its eyes to such countries as Algeria and Turkey, the United States is violating the sanctions themselves,'' Kalyuzhny said ------------------------------------------------------------- Monday October 4 7:28 PM ET Iraq Allowed To Export More Oil By NICOLE WINFIELD Associated Press Writer UNITED NATIONS (AP) - While still deadlocked on an overall new policy for Iraq, the Security Council on Monday authorized Baghdad to temporarily export more oil. The council unanimously adopted a draft resolution that slightly adjusts the U.N. oil-for-food program, which lets Iraq export $5.26 billion in oil over six months to buy food and medicine for its people suffering under sanctions. The U.N. sanctions were imposed after Iraq's 1990 invasion of Kuwait. Iraq is expected to reach the $5.26 billion ceiling between Oct. 8 and 12 - more than a month before the six-month period expires Nov. 20. Without Security Council action, Iraq would not legally be able to keep exporting oil. The new resolution, introduced by the Netherlands, would allow Iraq to keep exporting oil beyond the $5.26 billion limit through Nov. 20 to make up for export shortfalls from previous six-month periods. Because of low oil prices and production limits, Iraq fell more than $3 billion short of the ceiling last year. U.S. officials stressed that the Dutch resolution was a technical maneuver that didn't constitute any lifting of the export limit or easing of sanctions. By making up for oil export shortfalls from last year, the council is merely allowing Iraqis to have the food and medicine they were authorized to get but couldn't because of low oil prices, Deputy U.S. Ambassador Nancy Soderberg said. ``The resolution does not alter the overall structure of the oil-for-food program, but will help redress the shortfall brought about by the lower world oil prices,'' she said in a statement. U.N. weapons inspectors withdrew from Iraq in December, before the United States and Britain launched airstrikes to punish Baghdad for failing to divulge all information about its banned weapons programs. Iraq has said the inspectors from the U.N. Special Commission cannot return, and has demanded sanctions be lifted immediately. Baghdad says it has complied fully with U.N. resolutions demanding it rid itself of its biological, chemical and nuclear weapons. Under U.N. resolutions, the sanctions cannot be lifted until Iraq is declared to be free of its weapons programs. Iraqi Foreign Minister Mohammed Saeed al-Sahhaf met Monday with U.N. Secretary-General Kofi Annan to discuss the oil-for-food plan, officials said. Iraq has complained - as recently as Monday in a press release - that the Security Council sanctions committee was holding up contracts for badly needed protein biscuits and therapeutic milk. Al-Sahhaf was in New York for the U.N. General Assembly's annual debate. -------------------------------------------------- __________________________________________________ Do You Yahoo!? Bid and sell for free at http://auctions.yahoo.com -- ------------------------------------------------------------------------- This is a discussion list run by the Campaign Against Sanctions on Iraq. To be removed/added, email firstname.lastname@example.org, NOT the whole list. 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