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28 August 2001  

Oil-for-Food Background Information


Weekly update

(18 - 24 August 2001)

There was a noticeable increase in the volume of Iraqi oil exports under the United Nations oil-for-food programme in the week ending on 24 August. At an average rate of 2.4 million barrels a day, Iraq exported 16.8 million barrels of oil, compared with the previous weekly volume of 13.9 million barrels during two consecutive weeks. There were five loadings each from the two authorized loading terminals of Mina al-Bakr and Ceyhan, with 10.4 million barrels and 6.4 million barrels, respectively. The revenue raised from the week’s oil sales was an estimated €397 million (euros) or $362 million, at current prices and rates of exchange. The average price of Iraqi crude oil during the week was approximately €24.60 or $22.49 per barrel.

In current phase X of the programme, which runs from 4 July to 30 November 2001, thus far, 96.3 million barrels of oil have been lifted, generating an estimated €2.15 billion or $1.96 billion in revenue. The United Nations oil overseers during the week approved 12 new oil purchase contracts for seven million barrels of Basrah Light and 12 million barrels of Kirkuk crude. There are now 98 approved oil purchase contracts in phase X for 282 million barrels of oil, 171 million of which are for Basrah Light and 111 million for Kirkuk.

Since the beginning of the programme on 10 December 1996, Iraqi oil sales of almost 2.6 billion barrels have earned an estimated revenue of some $38.6 billion and €8.8 billion ($7.6 billion). The United States dollar was replaced with the euro for the Iraqi oil purchases in early November 2000, at the request of the Government of Iraq and with the consent of the Security Council’s 661 sanctions committee. With the adoption of Security Council resolution 1330 (2000) on 5 December 2000, 72 per cent of the oil proceeds fund the humanitarian programme in Iraq, 59 per cent of which is for the 15 central and southern governorates and 13 per cent for the three northern governorates.

Contracts worth $25.4 billion for humanitarian supplies and another $2.1 billion worth of contracts for oil industry spare parts and equipment have been approved by the Security Council’s 661 sanctions committee and “fast-tracked” by the Office of the Iraq Programme (OIP) since the start of the programme. Of these, more than $14.1 billion worth of humanitarian supplies and $858 million worth of oil industry spare parts and equipment have been delivered to Iraq, while additional $11.3 billion worth of humanitarian supplies and $1.3 billion worth of oil spare parts and equipment are in the production and delivery pipeline.

During the week, the 661 Committee placed on hold 32 new contracts, valued at $96.4 million, whereas nine contracts, worth $7.7 million, were released from hold. The total value of “holds” now stands at $3.58 billion. In all, 1,481 contracts are on hold, comprising 1,017 humanitarian supply contracts, worth over $3 billion, and 489 contracts for oil industry spare parts and equipment, worth $516 million.

As at 24 August, over $1.5 billion and €724 million in unused funds were available in the United Nations escrow account for the issuance of additional letters of credit for the purchase of humanitarian supplies and oil spare parts and equipment by the Government of Iraq.

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Produced for media and public information – not an official United Nations Document
For further information please contact Hasmik Egian, OIP - NY, 1.212.963.4341