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30 October 2001  

Oil-for-Food Background Information


Weekly Update

(20 - 26 October 2001)

The Security Council’s 661 sanctions committee approved retroactively the Iraqi oil pricing mechanisms for deliveries to the United States market for the month of October.

At the average rate of over 2.1 million barrels a day, Iraqi oil exports, in the week 20 - 26 October, totaled 14.9 million barrels, generating an estimated €294 million (euros) or $260 million in revenue, at current prices and rate of exchange. There were five loadings each at the two authorized loading terminals of Mina al-Bakr and Ceyhan, with 9.9 million barrels of oil from the former, and five million barrels from the latter. The average price of Iraqi crude oil during the week was approximately €19.70 or $17.55 per barrel.

There are now 137 approved oil purchase contracts in phase X, including three new contracts approved by the United Nations oil overseers during the week in review. The volume of oil covered by these contracts amounts to some 383 million barrels, 231 million of which are for Basrah Light and 152 million for Kirkuk crude. Thus far in phase X of the United Nations oil-for-food programme, Iraq has exported 226 million barrels of oil for an estimated revenue of €4.77 billion or $4.25 billion. The phase ends on 30 November 2001.

Since the beginning of the programme on 10 December 1996, some $38.6 billion and €11.4 billion ($9.9 billion) in estimated revenue has been raised from the export of more than 2.7 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.

Almost $29.3 billion worth of humanitarian supply contracts have been both approved by the 661 Committee and “fast-tracked” by the Office of the Iraq Programme (OIP), since the start of the programme, including $2.5 billion worth of contracts for oil industry spare parts and equipment. So far, about $15.6 billion worth of humanitarian supplies and $953 million worth of oil industry spare parts and equipment have been delivered to Iraq, while another $11.2 billion worth of humanitarian supplies and $1.5 billion worth of oil spare parts and equipment are in the production and delivery pipeline.

The total value of contracts placed on hold by the 661 Committee remained almost unchanged at $3.99, covering 1,528 contracts for various humanitarian supplies and equipment. Of these, 1,364 contracts, worth $3.67 billion, were “active holds”, while 164 contracts, worth $320 million, were “inactive holds”. Contracts that are placed on hold by the Committee requiring additional technical information for further evaluation, are categorized as “inactive holds” where the requested information is not provided by the suppliers in excess of 60 days. Once this information is received, the relevant contract is put back in the “active holds” category for decision by the holding Committee member(s). In the category of “active holds” there were 217 contracts, worth $467 million, for which although the suppliers had provided the requested information, the holding Committee member(s) had not made a final decision in excess of 60 days.

During the week, the Committee released from hold 31 contracts, worth $73.2 million, while placing on hold 62 new contracts, worth $72.6 million. In all, 909 humanitarian supply contracts, worth $3.17 billion, and 455oil industry equipment contracts, worth $500 million, were in the “active holds” category.

As at 26 October, just more than $1.4 billion and €573 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