The stalemate in the Security Council over the issue of the
frequency for reviewing prices for Iraqi crude oil deliveries, which are
submitted by the Iraqi State Marketing Organization (SOMO), has continued.
This has prevented the approval of prices for Iraqi crude oil to the United
States market in September. Nevertheless, the flow of Iraqi weekly oil
exports, ending on 21 September, under the United Nations oil-for-food
programme, was strong. At an average rate of over 2.3 million barrels per day,
a total of 16.4 million barrels of oil were lifted from the two authorized
loading terminals of Mina al-Bakr and Ceyhan, with 9.8 million barrels from
the former and 6.6 million barrels from the latter.
The average price of Iraqi crude oil during the week was
approximately €25 or $23.10 per barrel. The week’s exports added another
€410 million (euros) or $379 million in estimated revenue, at current prices
and rate of exchange, bringing the total estimated revenue in current phase X
to €3.5 billion or $3.2 billion. Since the start of phase X on 4 July, some
153.5 million barrels of oil have been lifted. Phase X ends on 30 November
2001. The United Nations oil overseers have, so far, approved 127 oil purchase
contracts for this phase, including 13 new contracts during the week in
review. The quantity of oil covered by these contracts amounts to 349 million
barrels, 213 million of which are for Basrah Light and 136 million for Kirkuk
Since the beginning of the Programme on 10 December 1996,
some $38.6 billion and €10.1 billion ($8.9
billion) in estimated revenue has been generated from the sale of over 2.65
billion barrels of oil. 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.
So far, $25.9 billion worth of contracts for humanitarian
supplies and another $2.2 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). Humanitarian supplies worth about $14.8 billion and $905 million worth
of oil industry spare parts and equipment have been delivered to Iraq. In
addition, $11.1 billion worth of humanitarian supplies and $1.3 billion worth
of oil spare parts and equipment are in the production and delivery pipeline.
In a reversal of recent weeks’ trend, the number and value
of contracts released from hold by the 661 Committee outweighed those placed
newly on hold. In all, 54 contracts, worth $179.5 million, were released from
hold, including 11 contracts, worth $111.4 million for various types of
vehicles, trucks and buses, while 34 new contracts, worth $114.2 million, were
placed on hold by the Committee. Altogether, 1,508 contracts worth almost $4
billion were on hold, comprising 1,037 contracts for humanitarian supplies
worth almost $3.5 billion and 471 contracts for industry spare parts and
equipment worth $527 million.
As at 21 September, about $1.2 billion and €795 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.