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News for 5 to 12 Dec, 1999

News for the the period 6 December to 12 December,

* US/UK aerial bombings on at least 3 separate days.
Possible civillian casualties.

* UN Security Council renews Oil-for-Food for 6

* Security Council will vote on "British-Dutch" /
"Consensus" resolution on Monday.

* Iraq has cancelled Papal visit -- says that embargo
and aerial attacks make trip impossible to organise.

* Iraq to resume oil exports.

* Oil price seesaws, remains high, but moved downwards
on Friday.

* 4000 families evicted from Baghdad. Interior
minister cites pressured infrastructure as motive.

Sources: Reuters, Associated Press,
Sunday December 12 7:13 PM ET 
Iraq Claims Airstrikes Killed Kids
BAGHDAD, Iraq (AP) - Allied warplanes bombed a
residential area in northern Iraq on Sunday, killing
two children and injuring six people, the official
Iraqi News Agency reported. 
Maj. Andy White, a U.S. spokesman at the base in
Turkey where planes patrolling Iraq are stationed,
confirmed that American planes returned fire after
being fired on by Iraqi anti-aircraft artillery. 
But White said he had ``nothing to support claims of
damage or injury to civilians.'' 
The Iraqi report quoted an unidentified spokesman for
the Iraqi army. It said there were 14 sorties over the
northern provinces of Dohuk, Irbil and Mosul. It did
not specify precisely what was hit or where the
missiles landed. 
``The American-British killers have committed another
crime against Iraqi civilians when their warplanes
bombed residential areas and civil installations
causing the death of two children and the injury of
six (people), including a woman and five children,''
the agency quoted the army spokesman as saying. 
The U.S. European Command, based in Germany, said
coalition aircraft responded to the anti-aircraft
artillery by striking air-defense targets. It said all
coalition aircraft left the area safely. 
Allied warplanes have been patrolling over northern
and southern Iraq since after the 1991 Gulf War.
So-called ``no-fly'' zones were set up to protect
Kurds in the north and Shiites in the south from the
Iraqi military. 
Iraq has been challenging the patrols all year. The
United States maintains that it fires only on military
targets and only when threatened. 
Saturday December 11 10:29 AM ET 
Split U.N. Council Readies New Policy Toward Iraq
By Evelyn Leopold 
UNITED NATIONS (Reuters) - The U.N. Security Council
prepared to take a critical vote that could lead to a
suspension of sanctions against Iraq after a six-month
extension of the ''oil-for-food'' humanitarian program
in Baghdad was approved. 
British Ambassador Jeremy Greenstock, the current
council president, said he had scheduled a Monday vote
on a resolution that would set up a new arms control
commission aimed at returning weapons inspectors to
Baghdad after a year's hiatus. 
If Iraq cooperates with a new arms commission, the
sanctions could be suspended in a complicated and
controversial process expected to take at least a
The decision to consider the comprehensive resolution,
under negotiation for eight months, came after all 15
council members voted Friday for a 180-day extension
to the oil-for-food program. 
This move allows Iraq to sell $5.26 billion in oil
over six months to buy food, medicine and other vital
goods for its people. 
Iraq stopped exporting oil on Nov. 24 after the
council narrowly approved stopgap resolutions
extending the oil deal for two weeks and then for one
week. Baghdad said it would resume oil sales --
probably on Dec. 15 or 16 -- if the program was
renewed for six months. 
The United States last month insisted on the short
extensions to pressure council members into adopting
the broader, comprehensive resolution that would make
some of the oil-for-food provisions obsolete. 
Deliberate Ambiguity 
Passage of the resolution Monday is not certain
despite compromises on all sides. 
Some key areas, such as precisely what would trigger
the suspension, are left purposely ambiguous in an
effort to get support from all 15 council members. 
But diplomats are unsure how Russia, China and France
-- more sympathetic to Iraq -- will vote. Moscow and
Beijing are not expected to support the resolution but
might abstain rather than use their veto power to kill
France is expected to vote in favor or abstain,
diplomats said. 
Greenstock was optimistic. 
``I am confident that this is a good text, which
should get support from a maximum number of members of
the council and will be carried,'' he said Friday. 
The sanctions were imposed on Iraq after President
Saddam Hussein's government invaded Kuwait in August
1990, leading to the 1991 Gulf War. After the war, any
lifting of the sanctions was linked to the scrapping
of Iraq's weapons of mass destruction, a procedure
that has taken nearly 10 years. 
Arms inspectors left Iraq a year ago, shortly before
U.S.-British bombing raids against Baghdad for its
alleged failure to cooperate with the U.N. disarmament
Friday, Russia proposed amendments, supported by China
and Malaysia, to the full council that would have
required Iraq to cooperate, but not fully cooperate,
with the inspectors, diplomats said. 
The aim was to prevent the United States and Britain
from imposing arms requirements that Iraq could not
meet and thus keeping the sanctions in place
Russia also wanted the sanctions to be suspended by
next December regardless of Iraq's cooperation, a
proposal Greenstock said would allow Iraq to ``sit and
Moscow's Ambassador Sergei Lavrov said the resolution
was too ambiguous. 
``We don't think it is clear-cut, and we believe it is
not as it should be,'' he told reporters. 
U.S. representative Peter Burleigh said he anticipated
talks throughout the weekend on the resolution among
Secretary of State Madeleine Albright, Russian Foreign
Minister Igor Ivanov and French Foreign Minister
Hubert Vedrine. 
France, which had earlier approved the text, said the
resolution would have little impact if all council
members did not support it. 
Its Ambassador Alain Dejammet said it was necessary to
have clarity in the resolution and make sure Russia
was supporting the document or Iraq would never
Iraq has lobbied vigorously against the resolution,
threatening France with a break in diplomatic and
economic ties and attempting to persuade Moscow to use
its veto. Baghdad wants nothing less than a clear path
to the lifting of the sanctions, which have ruined its
Friday December 10, 5:48 pm Eastern Time 
Iraq news sends oil prices, shares spiralling down
By Timna Tanners  
LOS ANGELES, Dec 10 (Reuters) - Oil prices sank nearly
$1 a barrel on Friday on news that the U.N. Security
Council agreed to renew the humanitarian
``oil-for-food'' deal with Iraq another six months. 
The looming resumption of Iraqi crude exports helped
send the January New York Mercantile Exchange (NYMEX)
crude contract falling 92 cents to $25.23 a barrel. It
dipped as low as $1.55 a barrel after the U.N. vote. 
Energy company shares followed suit, diving in general
on the long-awaited U.N. news. 
``Oil prices have pressured shares for the past
several days. Iraq is closer to returning to the
market,'' said PaineWebber analyst Frank Kneuttel. 
``It was another day when the ''dot-coms`` took money
away from oil stocks,'' he added, referring to the
popularity of internet stocks. 
Oil shares sank despite overall strength on the Dow
Jones Industrial Average, which closed up 0.81
percent, or nearly 90 points, at 11,224. 
The U.N. voted to allow Iraq to resume exports after a
break since November 24, when Baghdad stopped
deliveries because of a U.N. dispute over a new
resolution on sanctions. Oil traders have estimated
Iraq's approximate 2.3 million barrels a day of
exports would begin again in a week. 
The news followed bearish remarks the previous day
from U.S. Energy Secretary Bill Richardson, who said
oil prices were drifting dangerously higher.
Independent U.S. oil companies decried Richardson's
The largest publicly traded oil company, Exxon Mobil
Corp., led losers with a 3-5/16 loss to close at
82-13/16 on the New York Stock Exchange. Texaco Inc.
also saw shares tumble, down 2-1/16 to 54-7/16 each. 
Large integrated oil companies shares weakened, as
measured by the Standard & Poor's Oil International
Index , which fell 1.45 percent to 51.88 points. 
Oil drilling and services companies lost ground,
reflecting recent problems. Halliburton Co. fell
1-3/16 to 34-15/16 while competitor Schlumbeger Ltd.
dipped 2 to 56-1/8. 
Among independent oil and gas producers, Apache Corp.
fell 3/16 to 32 each. edged down 3/16 to 32-3/16. The
company said it expected to spend $600 million to $650
million on exploration and development in 2000. 
Major oil refiners also saw shares slip, with Tosco
Corp. down 1-4/16 to 25-15/16 and Sunoco Inc. down
13/16 to 23-9/16.
Sunday December 12 7:56 AM ET 
Official: Iraq To Resume Pumping Oil
By WAIEL FALEH Associated Press Writer 
BAGHDAD, Iraq (AP) - Iraq will resume pumping oil for
export this week after a three-week stoppage, an Oil
Ministry official said Sunday. 
The announcement came after the U.N. Security Council
voted Friday to extend its oil-for-food program, which
allows Iraq to sell $5.26 billion in oil over six
months to buy humanitarian goods. 
Iraq had suspended pumping after the council initially
failed to give a full six-month renewal when the
program's last phase expired on Nov. 24. The council
instead had extended it by two weeks and then by one
The three-year-old program is meant to ease the
suffering on Iraq caused by the U.N. economic
sanctions imposed in 1990 after Iraq invaded Kuwait. 
The Oil Ministry official told The Associated Press
that its two oil terminals in the north and the south
would resume operations either on Wednesday or
The extension of the program was held up while the
Security Council debated a comprehensive policy on
Iraq, which has been under negotiations for the last
eight months. 
On Saturday, the council decided to put to vote a
final British-drafted resolution offering Iraq the
possibility of suspending the sanctions. In return,
Iraq would have to allow the resumption of weapons
A U.N. certification that Iraq no longer possesses
weapons of mass destruction was the original condition
for the lifting of the sanctions. But U.N. weapons
inspectors left Iraq Dec. 16, 1998, just before the
United States and Britain launched airstrikes to
punish Baghdad for failing to cooperate with their

UN extends oil-for-food, US ups pressure on Iraq
Iraq, Economics, 12/11/99 
The United Nations Security Council yesterday voted
unanimously to extend the oil-for-food program with
Iraq for another six months in resolution 1281.

The full extension comes following two-week and
one-week extensions of the program, both of which Iraq
rejected, after the expiration of the most recent
six-month term. Under the terms agreed on yesterday,
Iraq will be able to produce up to $5.26 billion in
oil and oil products for a 180-day period and sell the
goods to fund the purchase of humanitarian supplies
for Iraq's citizens.

The resolution calls for UN Secretary General Kofi
Annan to report to the council 90 days after the start
of the new term and prior to it's end on Iraq's
distribution of supplies to civilians, the program's
ability to meet humanitarian needs, and on Iraq's
ability to produce sufficient quantities of petroleum
to reach the limit set by the program.

The US has raised new accusations that Iraq is
allowing oil to be smuggled in violation of UN
sanctions. US State Department deputy spokesman James
Foley said yesterday, "Recently declassified satellite
photography.... reveals that Iraq continues to smuggle
oil in violation of UN sanctions."

He said a November 26 photo showed Iraqi tankers in
the Shatt al-Arab "in the process of loading gasoil at
a facility associated with the Basra refinery in
southern Iraq" which he said is not allowed under UN
sanctions. "The gasoil being loaded onto tankers in
this photograph is being smuggled illicitly outside
the Oil-For-Food Program to supply revenue that is
totally under the regime's control," Foley added.

These accusations come as the US is working in the UN
Security Council for the approval of a resolution that
will conditionally suspend economic sanctions on Iraq
in return for the return of UN weapons inspectors to
the country.
Friday December 10, 2:47 pm Eastern Time 
US alleges Iraq smuggled record amount gasoil Nov.
WASHINGTON, Dec 10 (Reuters) - Iraq illegally sold
70,000 barrels of gasoil a day during November, the
most since sanctions were imposed against the country
following the Gulf War, a U.S. State Department
spokesman alleged Friday. 
Iraq earned $21 million from the illegal gasoil sales,
as they were not under the control of the United
Nations-run oil-for-food program, which allows Iraq to
use oil export revenue to buy food, food medicine and
other goods, the spokesman also alleged. 
``It demonstrates yet again that Saddam Hussein puts
the interest of his regime ahead of those of the
people of Iraq,'' spokesman James Foley told reporters
at the State Department's daily briefing. 
Gasoil is refined crude oil that is heavier than
kerosene and is often used as diesel fuel. 
Foley said the illegal sales occurred while Iraq
suspended its legal oil export sales in protest of the
U.N. Security Council's refusal to extend Iraq's
oil-for-food program for six months. 
Earlier Friday, the Security Council approved an
extension of the aid program until June 8, 2000. 
(-Tom Doggett, Washington Energy Desk, 202-898-8320) 
Friday December 10 7:14 AM ET 
Baghdad Rules Out Papal Visit
VATICAN CITY (Reuters) - The Vatican said on Friday it
had been told by Iraq that a visit by Pope John Paul
to the country would not be possible. 
The Vatican said Iraq had told it that a United
Nations embargo on Iraq and a no-fly zone over part of
the country would make it impossible for the Pope to
visit the southern city of Ur, birthplace of the
Biblical patriarch Abraham. 
``Iraqi authorities have informed the (Vatican)
Secretariat of State that the abnormal conditions in
which Iraq finds itself due to the embargo and the
no-fly zone, as well as the general situation in the
region, do not permit a visit by the Holy Father to Ur
to be organized properly,'' chief Vatican spokesman
Joaquin Navarro-Valls said in a statement. 
A visit to Ur was the main purpose of the Pope's
projected trip to Iraq and was one of the Old and New
Testament sites he wants to pray at during 2000. 
The trip to Iraq, which would have included a meeting
between the 79-year-old Pope and Iraqi President
Saddam Hussein, had originally been slated for early
December. A Vatican team of officials flew to Iraq
last month for further consultations and had intimated
the trip could be possible for early in January. 
Thursday December 9, 5:23 am Eastern Time 
Iraq to pump Sat if UN votes Fri for 6-month deal
BAGHDAD, Dec 9 (Reuters) - Iraq will resume pumping of
oil on Saturday if the U.N. Security Council agrees on
Friday a straightforward six-month rollover of the
United Nations' oil- for-food programme, an Iraqi Oil
Ministry source said on Thursday. 
``The Iraqi Oil Ministry is readying itself to resume
pumping of crude oil for export purposes on Saturday
if the United Nations renews the programme for another
six months,'' the source, who asked not to be named,
told Reuters. 
The source did not say whether Iraq would resume its
oil pumping to the Turkish port of Ceyhan in the
Mediterranean or to the Iraqi southern Mina-al-Bakr
oil terminal, both used to export oil under previous
oil-for-food deals with the U.N. 
The U.N. Security Council is expected to renew the oil
pact for six months before the current extension
expires late on Saturday, the United States and
Britain said on Wednesday. 
Iraq's U.N. envoy Saeed Hasan said on Wednesday that
his country would accept a straightforward six-month
renewal of the oil programme. 
Iraq suspended oil exports three weeks ago in protest
of the Security Council's short extensions of the
programme rather than the usual six-month renewal, a
move Baghdad said was forced by the U.S. in order to
put pressure on parallel negotiations for a resolution
on broader Iraq policy. 
((Hassan Hafidh, Baghdad newsroom) 
Wednesday December 8 3:25 PM ET 
Iraq Evicts Thousands From Baghdad
By LEON BARKHO Associated Press Writer 
BAGHDAD, Iraq (AP) - Authorities have evicted from
Baghdad more than 4,000 families who migrated to the
capital after fleeing their southern towns during the
1991 Persian Gulf War, the Interior Ministry said in a
statement published Wednesday. 
Thousands more are expected to be forced to leave the
city, the statement said. It gave no figures and did
not give a timeframe. 
The migrant families had moved to the capital
illegally and their presence ``has had an obvious
impact on Baghdad's economic and social situation,'' a
ministry spokesman was quoted as saying in the
statement published in the state-run weekly, Al-Ilam. 
The statement did not say when the deportations
started nor how many people 4,000 families
It said eight committees, made up of officials from
the security forces and the ruling Baath party, have
been set up to survey Baghdad's nearly 5.4 million
people to see who is eligible to stay. 
Under a 1994 law, only those people who came to
Baghdad before 1991 have the right to stay. A round of
deportations was held in 1995 but authorities say
thousands of families sneaked back. 
Public utilities in Baghdad are relatively better than
in other parts of the country - particularly the
battered provinces in the south, which bore the brunt
of Iraq's 1980-1988 war with Iran and the 1991 Persian
Gulf War against a U.S.-led coalition that drove Iraqi
forces out of Kuwait. 
While Baghdad suffers power outages of just four hours
a day, the blackouts may last up to 20 hours in the
provinces. U.N. trade sanctions, imposed for Iraq's
1990 invasion of Kuwait, have crippled the country's
Many opt for residence in the capital because of lack
of security in their areas particularly in the south,
where the United States and Britain police a no-fly
zone ostensibly to protect the country's Shiite
minority from attacks by Iraqi armed force. 
Wednesday December 8 1:34 AM ET 
Saddam's Weapons Program Questioned
By TOM RAUM Associated Press Writer 
WASHINGTON (AP) - Almost a year has passed since
Operation Desert Fox and more than a year since U.N.
weapons inspectors left Iraq. As the United Nations
struggles to frame a new policy toward Baghdad, many
in the West fear Saddam Hussein has used the pause to
rebuild his weapons program. 
Defense Secretary William Cohen is among those with
such fears. 
``I think they are determined to rebuild their
military,'' Cohen told reporters Tuesday. It's even
possible that Saddam has been acquiring weapons-grade
nuclear materials, Cohen allowed. ``I'm saying we
don't know,'' Cohen said. 
Meanwhile, a bipartisan group of lawmakers is trying
to pressure the Clinton administration to do more to
carry out the spirit of the year-old Iraq Liberation
Act, which earmarked $97 million in U.S. assistance to
Iraqi opposition groups seeking to overthrow Saddam. 
To date, only a fraction of that amount has been spent
- mostly for office equipment and training classes in
Florida on democracy. 
The administration contends the $97 million does not
cover arms but only indirect assistance and
``nonlethal'' training. 
But slipped into the huge government operations
spending bill that President Clinton signed last month
was another $10 million - this time in direct money -
to ``support efforts to bring about political
transition in Iraq.'' 
Of this, $2 million was designated for efforts to
prosecute Saddam and his lieutenants for war crimes. 
Sen. Sam Brownback, R-Kan., chairman of the Foreign
Relations subcommittee on Near Eastern and South Asian
affairs, said the $10 million appropriation was
intended to force the administration to support
anti-Saddam activities inside Iraq instead of buying
``file cabinets and fax machines.'' 
``The administration is doing a very slow roll on
this. I think they're generally figuring this one is
going to go to the next president,'' said Brownback. 
The notion that Saddam's reign may outlast yet another
U.S. president has already become an issue on the
presidential campaign trail. 
In last week's Republican debate in Manchester, N.H.,
front-running candidate George W. Bush appeared at
first to suggest that he would ``take out'' Saddam,
perhaps finishing the job his father began when the
military coalition he organized drove Iraqi forces
from Kuwait. 
``If I found in any way, shape or form that he was
developing weapons of mass destruction, I'd take 'em
out. I'm surprised he's still there,'' Bush said. 
But asked to elaborate on what he would ``take out,''
Bush said, ``weapons of mass destruction.'' 
Official U.S. policy, dating from a 1976 executive
order signed by President Ford, makes assassination of
a foreign leader illegal. 
Nevertheless, both Presidents Bush and Clinton signed
orders authorizing covert activities to topple Saddam,
according to congressional and intelligence sources,
but none came to fruition. 
U.N. arms inspectors left Iraq in November 1998 after
the chief inspector, Richard Butler, said Iraq had
failed to cooperate with efforts to seek out weapons
banned under the agreement that ended the Gulf War.
Operation Desert Fox, four days of U.S. and British
airstrikes against targets in Iraq, followed in
After the campaign ended, Iraq said the commission's
job in Iraq ``is over'' and ruled out its return so
long as Butler headed it. 
Iraqi leaders recently said they would allow
inspectors back, but only after sanctions in place
since August 1990 are abolished. 
The U.N. Security Council is struggling now to forge a
new comprehensive policy on Iraq that would allow the
inspectors to return, but its members remain divided.
It agreed to a series of short extensions of the
oil-for-food program, which allows Iraq to bypass
sanctions and sell oil to buy food and humanitarian
goods. The most recent extension expires Saturday. 
Iraq opposes the short-term extensions as ``political
Sen. Bob Kerrey, D-Neb., a sponsor of the Iraq
Liberation Act, told a gathering in New York of the
Iraqi National Congress, the leading opposition group,
that the United States is spending $2 billion a year
to contain Saddam. ``It simply isn't working, and it
is unsatisfying to the American people,'' he said. 
Still, administration officials note that opposition
groups are fragmented, many feuding among themselves. 
State Department spokesman James Foley suggested this
week that U.S. intelligence agencies aren't totally in
the dark as to recent developments in Iraq regarding
weapons of mass destruction. 
``We maintain robust national capabilities to monitor
as best we can what Saddam Hussein may be up to in
this area,'' Foley said. 
Still, he said, ``It remains our view that having
inspectors on the ground is the best insurance
Tuesday December 7 10:17 PM ET 
Council Schedules Iraq Consultations
By NICOLE WINFIELD Associated Press Writer 
UNITED NATIONS (AP) - For the first time in weeks, the
full Security Council is being brought into talks on a
plan to return weapons inspectors to Iraq - with the
United States pressing for action by the end of the
But Russia, an Iraqi ally on the powerful council, is
insisting it needs more time for negotiations - and
demanding a resolution that offers Iraq a clear path
to have 9-year-old sanctions lifted. 
``There is still room for compromise - we can work on
monitoring regime and on timeframe for lifting the
sanctions,'' the Foreign Ministry chief spokesman
Vladimir Rakhmanin said Tuesday in Moscow. 
U.S. Undersecretary of State Thomas Pickering was in
New York on Tuesday to meet with Russian Ambassador
Sergey Lavrov to try to reach a compromise over the
resolution, which has the support of most of the
council, a U.S. official said. 
Russian backing for the resolution is key since it
could veto the measure, leaving the council with
little to show for nearly a year of negotiations that
began after weapons inspections in Iraq collapsed last
British Ambassador Jeremy Greenstock, the current
council president, said he wouldn't rule out any area
of discussion during Wednesday's scheduled closed door
consultations, which would mark the first time in
weeks that the full 15 members have met on the
The permanent five members of the council - Britain,
the United States, Russia, France and China - have
been meeting privately at the U.S. mission for weeks
to try to narrow the differences on the resolution. 
Russia and China favor the suspension of sanctions,
which were imposed after Iraq's 1990 invasion of
Kuwait, soon after Iraq allows inspectors to return
and demonstrates it is cooperating with them. But the
United States and Britain want a longer waiting period
and Iraqi answers to outstanding questions about its
``It's up to council members to talk about the
comprehensive approach on Iraq as they wish,''
Greenstock said. ``But I made it clear that we need to
take action before the weekend.'' 
The United States and Britain want the council to vote
on the resolution before Saturday, when the current
phase of the U.N. humanitarian program in Iraq
expires. The program lets Iraq sell limited amounts of
oil to buy food, medicine and oil industry spare parts
for its ailing oil sector. 
A vote on the overall new policy resolution would
enable the council to extend the U.N. program for six
months and incorporate a host of enhancements included
in the overall policy resolution, such as removing the
dlrs 5.2 billion limit in the amount of oil Iraq can
export over six months. 
Diplomats said Tuesday the United States would support
a six-month extension of the program even if the
council doesn't agree on the overall resolution. 
Tuesday December 7, 8:28 pm Eastern Time 
When is a British draft not a British draft?
UNITED NATIONS, Dec 7 (Reuters) - Iraq says key
Security Council members are working on a ``British''
draft resolution that might eventually restart arms
inspections and suspend sanctions against Baghdad. 
Not so, say France, Russia and even Britain itself,
contending that the original British-Dutch draft of
last April had been changed appreciably in style and
content and included elements from separate French and
Russia drafts. 
A reading of both versions shows some of the main
points of the April resolution are included. But many
paragraphs are rewritten and lengthened, often to
paper over differences and include opposing views. 
``It is no longer a British paper,'' France's U.N.
ambassador Alain Dejammet said bluntly. In Moscow,
foreign ministry spokesman Vladimir Rakhmanin also
rejected the label. And British officials stop
journalists in mid-sentence if the term is used. 
Some Western envoys believe Iraq insists on using that
name to alienate Russia, China and France, whose
support is still not certain after protracted
negotiations among the five permanent Security Council
members -- the United States, Russia, France, Britain
and China. 
The United States, however, apparently believes
Baghdad has a point. State Department spokesman James
Rubin two weeks ago said Washington was working
closely with ``the British and the Dutch on their
draft resolution.'' 
Tuesday December 7, 8:45 am Eastern Time 
Iraq's Aziz says UN may not offer six-month extension
By Hassan Hafidh 
BAGHDAD, Dec 7 (Reuters) - Iraq's Deputy Prime
Minister Tareq Aziz on Tuesday reiterated that Baghdad
would accept a straightforward six-month extension of
the United Nations oil-for-food exchange. But he
warned that such a deal might not be on offer from the
U.N. Security Council. 
``I have told the (U.N.) Secretary-General Kofi Annan
that we will accept an extension (of the oil
programme) of six months as it was the case before,''
Aziz told a conference of a non- alignment students
and youth organisation held in Baghdad. 
``But it is possible that such (six-month) extension
could not happen,'' Aziz said. 
Aziz informed Annan in a letter he sent on Monday that
his country would accept an extension of six months of
the oil pact. He also informed him on Iraq's rejection
of the terms of a U.N. comprehensive draft resolution
on his country. 
Iraq on Saturday rejected the U.N. Security Council's
one- week extension of the oil-for-food programme as
it did on November 19 when the deal was extended for
two weeks. Since November 22 Iraq halted its oil
exports to protest against the short time extension. 
The oil programme has always worked in phases of six
Aziz described next Friday as a ``decisive day'' for
the oil- for-food deal which usually allows Iraq to
sell $5.26 billion of oil over six months to buy food,
medicine and other goods. 
On Friday the one-week stop-gap measure which was
narrowly approved by the Security Council would
Aziz also reiterated his country's rejection of a U.N.
Security Council's draft resolution that could lead to
the suspension of sanctions on civilian goods if Iraq
complied for a test period with a new disarmament
Washington and London, both permanent Security Council
members, hoped that the one-week stop-gap would
pressure countries such as France and Russia to
approve the broader resolution on Iraq. 
``We reject this trickery and false draft
resolution,'' he said. ``It would subject Iraq to an
imperialist mandate and convert it to a
protectorate,'' he added. 
Both Russia and China, which are also permanent
members of the Security Council, have reservations
about the proposed resolution and want sanctions on
Iraq eased. 
``We have asked our friends in the Security Council to
prevent such draft resolution from being issued,'' he
Aziz was in Moscow last week where he had asked the
Russians to help Iraq to prevent adoption of the
Tuesday December 7 8:20 AM ET 
U.S. Planes Attack S. Iraq Targets
By LEON BARKHO Associated Press Writer 
BAGHDAD, Iraq (AP) - Iraqi anti-aircraft gunners fired
at U.S. and British warplanes as they attacked targets
in southern Iraq, state-run newspapers reported
The papers, quoting a military statement, said the
planes entered Iraqi airspace in 20 waves Monday
morning and carried out ``22 military sorties'' over
the provinces of Basra, Dhiqar, Missan, Najaf,
Qadissiya, Muthana and Karbala, all in southern Iraq. 
The United States, which along with Britain polices
two no-fly zones over Iraq, said just six planes
attacked military installations Monday, and that it
was in retaliation for anti-aircraft fire from a
military radar site in southern Iraq. 
The U.S. Central Command based in Florida said in a
statement that four U.S. Navy F/A-18 Hornets and two
F-14 Tomcats took part in the attack, then returned
safely to the USS John F. Kennedy in the Persian Gulf.
The U.S. statement said damage from the bombing had
yet to be assessed. 
The Iraqi papers accused the U.S. planes of attacking
``our civil and service installations.'' They reported
that Iraqi anti-aircraft gunners fired back, forcing
the attacking planes to flee ``to their hideouts of
evil and blasphemy in Saudi Arabia and Kuwait.'' 
U.S. and British planes have been patrolling no-fly
zones over northern and southern Iraq since the end of
the 1991 Persian Gulf War, saying they are protecting
Kurds and Shiites there from attacks by Iraqi armed
The allies say they target only military installations
when they are fired upon and strive to limit civilian
casualties or damage. 
Iraq says the zones are a violation of international
law and has frequently challenged the allied planes. 
Monday December 6, 4:05 pm Eastern Time 
NYMEX crude ends sharply up, Iraq prolongs hiatus
NEW YORK, Dec 6 (Reuters) - Crude oil futures on the
New York Mercantile Exchange (NYMEX) finished sharply
higher Monday as Iraq's standoff with the U.N. on oil
exports was seen adding pressure to already dwindling
stocks right before winter, traders said. 
NYMEX January crude settled at $26.66 a barrel, up a
hefty 85 cents. Near the close, it leaped higher to
post a late session peak of $26.72, up 91 cents on the
day. The contract traded as low as $26.05 in the
Traders and analysts said the front month contract is
again within a short distance of $27 and its November
23 peak of $27.15. 
Providing the booster for the day's trade was Iraq's
swift rejection of a second, short-term extension by
the U.N. Security Council of the oil-for-food deal
with Iraq. 
Late Friday, the U.N. Security Council narrowly
approved a one-week extension of the program, to
December 11, but Iraq's oil minister rejected it. 
Iraq had halted its exports of crude oil two weeks
ago, after the U.N. initially extended the
oil-for-food deal for two weeks. Iraq was exporting
about 2.4 million barrels per day (bpd) before it
stopped shipments. 
Iraqi officials have repeatedly said they would reject
another short-term extension because it is not
feasible to ship oil over such a short period of time
and that only a six-month rollover was acceptable. 
``Prices are only marginally above their level from
before Iraq's rejection of the initial oil sale
extension offer, so we doubt that this event has been
fully discounted yet,'' said Tim Evans, senior analyst
at Thomson Global Markets. 
Near the close, Mexican Energy Minister Luis Tellez
said he did not see the risk of an oil price spike,
despite recent highs. 
He also ruled out any increase in output before the
current producers agreement expires on March 31, 2000.

Meanwhile, heating oil and gasoline futures ended with
large gains, which they began to accumulate early
after crude's big opening gains. 
Gasoline futures were more active than heating oil. 
Front month gasoline posted a late session high of
72.60 cents a gallon, extending gains to 2.35 cents,
before settling at 72.54 cents, up 2.29 cents. The
contract had moved as low as 71.00 cents. 
Front month heating oil settled at 67.23 cents a
gallon, advancing 1.23 cents, after hitting a late
session high of 67.35 cents. It dipped earlier in the
day to a session low of 66.50 cents. 
In London, January Brent crude on the International
Petroleum Exchange (IPE), soared further and last
traded at $25.75 a barrel, hitting, up 80 cents, just
shy of the intraday hihgh of $25.80. 
Traders said oil markets on both sides of the Altantic
were also bullish over a statement by the Saudi Oil
Minister, Ali al-Naimi, over the weekend. The Saudi
official said market conditions were excellent and he
saw no reason to make changes to aproducers' output
cut agreement, which is expiring at the end of March
There were also indications since late last week that
oil producers had stuck to the curbs more scrupulously
in November. 
A survey by Geneva consultants Petrologistics showed
that 10 OPEC members participating in the agreement
produced 23.35 million barrels per day (bpd) in
November, compared to 23.62 million bpd in October.
That put the OPEC-10's output compliance to 91 percent
of the target cuts, compared to 85 percent in October.

On Tuesday, attention shifts once again to weekly
inventory report from the American Petroleum Institute
(API), which usually provides the market with
short-term price direction. 
Monday December 6 11:26 PM ET 
Iraq Urges UN To Renew Oil Program
By LEON BARKHO Associated Press Writer 
BAGHDAD, Iraq (AP) - Iraq asked the United Nations on
Monday for a six-month renewal of its oil-for-food
program, but reiterated that it will not accept a
draft British-Dutch resolution calling for the revival
of U.N. weapons inspections. 
In a letter to Secretary-General Kofi Annan, Deputy
Prime Minister Tariq Aziz said Iraq turned down
stopgap extensions of the U.N.-approved program
because they were impractical, the official Iraqi News
Agency reported. 
Aziz ``expressed Iraq's readiness to deal with a full
extension of the oil program,'' the agency reported. 
The U.N. Security Council voted to extend the program
for two weeks last month and for another week on
Friday, provoking protests by Iraq. 
The oil-for-food program allows Iraq to sell limited
quantities of oil, in an exception to U.N. trade
sanctions, and to use the money to buy food, medicine
and other essential supplies. The program routinely
has been renewed every six months since its inception
in December 1996. 
The latest renewals, supported by the United States,
were to spur council members to reach agreement on a
new comprehensive policy toward Iraq. 
Under U.N. resolutions, sanctions imposed after Iraq's
1990 invasion of Kuwait are not to be lifted until
U.N. inspectors certify that Iraq is free of weapons
of mass destruction. 
A draft British-Dutch resolution links a partial
suspension of sanctions to the resumption of
disarmament inspections. It is expected to upgrade the
oil-for-food program by removing the financial ceiling
of $5.2 billion and allowing foreign companies to
invest in the country's battered oil industry. 
Aziz told Annan that ``Iraq categorically rejects the
British resolution,'' because it ``imposes new
coercive conditions on Iraq which threaten its
sovereignty and national interests,'' the news agency
Iraq has said its weapons programs had ended and that
all sanctions should be ended. 
The U.N. Security Council resumed talks Monday to hear
whether Russia would support a U.S.-backed resolution.

Russia's U.N. Ambassador Sergey Lavrov said his
country's stance hadn't changed, and offered some
amendments to the resolution. But Western diplomats
said real negotiations with Moscow would begin on
Russia's position on the resolution is considered
crucial, since many Iraq watchers believe China will
follow Russia's lead in any vote on an overall new
policy. France, Iraq's other ally on the council,
recently was accused in the Baghdad media of leaning
towards resolution, already backed by the United
States and Britain. 
Monday December 6 11:21 AM ET 
U.S. Warplanes Bomb Southern Iraq
BAGHDAD (Reuters) - An Iraqi military spokesman said
U.S. and British aircraft bombed civilian targets in
southern Iraq on Monday before being driven off by
Iraqi forces. 
The spokesman, quoted by the official Iraqi News
Agency, said the planes flew 70 sorties over southern
Iraq, bombing civilian targets. He did not mention
The U.S. Central Command confirmed from its
headquarters in Tampa, Florida, that Navy F/A-18 and
F-14 jets enforcing a southern ``no-fly'' zone in Iraq
bombed an anti-aircraft artillery site and a military
radar near Al Amarah about 165 miles southeast of
The announcement said the strikes were in response to
Iraqi anti-aircraft fire against Western warplanes
earlier in the day. 
While the command did not respond directly to the
Iraqi charge that civilian targets were bombed, the
announcement said that U.S. and British aircraft
patrolling northern and southern no-fly zones in Iraq
``do not target civilian populations or infrastructure
and seek to avoid injury to civilians and damage to
civilian facilities.'' 
U.S. and British warplanes patrol no-fly zones over
Iraq's north and south almost daily. The zones were
declared by the West after the 1991 Gulf War to
protect groups opposed to Iraqi President Saddam
``Thirty hostile formations ... flew over the
provinces of Basra, Thi Qar, Meisan, Najaf, Qadissiya,
Muthanna, and Kerbala and the enemy attacked our
service and civil installations,'' the Iraqi military
spokesman said. 
``Our brave ground defenses intercepted these
formations and forced them to leave Iraqi airspace.'' 
Western military officials insist such attacks are
aimed only at military targets. 
On Saturday, Iraq said one person was wounded when
Western aircraft bombed targets in the country's
northern no-fly zone. 

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