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5 February 2002  

Oil-for-Food Background Information


Weekly Update

(26 January - 1 February 2002)

With seven liftings in all from the two authorized loading terminals of Mina al-Bakr and Ceyhan, Iraq’s oil exports totalled 13.5 million in the week ending 1 February 2002 under the United Nations oil-for-food programme, down slightly from the previous week’s total of 14 million barrels.  There were three loadings from Mina al-Bakr, with 6.7 million barrels of oil, and four loadings from Ceyhan, with 6.8 million barrels.  At the average price of approximately €19.60 (euros) or $16.80 per barrel, the week’s exports netted an estimated €266 million or $230 million in revenue, at current prices and rate of exchange.  

In current phase XI of the programme, which runs from 1 December 2001 to 29 May 2002, Iraq has, so far, exported 92 million barrels of oil out of the 280 million barrels approved for 115 oil purchase contracts, including nine new contracts approved by the United Nations oil overseers during the week in review.  Revenue generated in phase XI from the export of oil is estimated at €1.65 billion or $1.43 billion.  

An estimated $38.6 billion and €14.3 billion ($12.4 billion) in revenue has been earned from the export of some 2.89 billion barrels of oil since the start of the programme on 10 December 1996.  The United States dollar was replaced with the euro for 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. 

Concurrently, humanitarian supply contracts worth some $31.3 billion have been both approved by the 661 Committee and “fast-tracked” by the Office of the Iraq Programme (OIP), including $2.8 billion worth of contracts for oil industry spare parts and equipment.  To date, $19.1 billion worth of humanitarian supplies and equipment have been delivered to Iraq, including $1.1 billion worth of oil industry equipment, while another $10.5 billion worth of humanitarian supplies and $1.7 billion worth of oil industry equipment are in the production and delivery pipeline. 

During the week, 20 contracts, worth $55.1 million, were released from hold by the 661 Committee, while 63 new contracts, worth $134.7 million, were placed on hold by the Committee, bringing the total value of contracts on hold to $5.23 billion, covering 2,040 contracts for the purchase of various humanitarian supplies and equipment.  Of this total, 1,410 contracts, worth $4.55 billion, are for humanitarian supplies and 630 contracts, worth $680 million, are for oil industry spare parts and equipment. 

In the “inactive holds” category, there were 216 contracts, worth  $307.6 million, for which the suppliers had not provided the additional technical information in over 60 days, as requested by the “holding” Committee member(s).  At the same time, in the category of “active holds”, there were 558 contracts, worth more about $1.79 billion, for which although the suppliers had provided the requested information over 60 days ago, the “holding” Committee member(s) had not yet made a final decision. 

As at 1 February 2002, over $1.8 billion and €408 million in unused funds were available in the United Nations Iraq 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