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2 July 2002
Oil-for-Food Background Information


Weekly Update

(22 – 28 June 2002)

 The volume of Iraqi oil exports under the United Nations oil-for-food programme remained almost unchanged from the previous week’s total, standing at 8 million barrels in the week ending 28 June.  There were three loadings from Mina al-Bakr terminal, corresponding to 5.1 million barrels of oil, and two loadings from Ceyhan terminal, corresponding to 2.9 million barrels. With an average price of approximately €23.75 (euros) or $23.35 per barrel, the week’s exports generated an estimated €190 million or $185 million in revenue, raising the overall estimated revenue in current phase XII of the programme to €699 million or $697 million.  

During the week in review, the United Nations oil overseers approved an additional eight new oil purchase contracts, bringing the overall total to 118, corresponding to 226 million barrels of oil, of which 124 million barrels are for Basrah light and 102 million barrels for Kirkuk crude. Since the beginning of phase XII on 30 May 2002, the total volume of oil exported has amounted to 29.7 million barrels. The phase ends on 25 November 2002. 

Owing to a revenue shortfall, 991 humanitarian supply contracts, worth about $2.2 billion, while approved by the United Nations, are currently lacking in funds and cannot be further processed. The affected sectors are:  food handling with $348 million; electricity with $346 million; food with $343 million; housing with $303 million; agriculture with $284 million; health with $184 million; telecommunication and transportation with $173 million; water and sanitation with $118 million and; education with $107 million. 

Iraq has exported more than 3 billion barrels of oil at an estimated $38.6 billion and €18.3 billion ($16.3 billion) in revenue since the beginning of the programme on 10 December 1996.  The humanitarian programme receives 72 per cent of the oil proceeds, with 59 per cent allocated to the 15 central and southern governorates and 13 per cent to the three northern governorates. To date, some $35.6 billion worth of contracts for the purchase of various humanitarian supplies and equipment have been both approved by the Security Council’s 661 sanctions committee and “fast-tracked” by the Office of the Iraq Programme (OIP), including about $3.2 billion worth of oil industry spare parts and equipment.  Of the approved contracts, over $23 billion worth of supplies and equipment have been delivered to Iraq, including $1.4 billion worth oil spare parts and equipment, while another $10.2 billion worth of supplies and equipment, for which funds have been available, are in the production and delivery pipeline, including $1.7 billion worth of oil industry equipment.  

During the week, the 661 Committee released from hold 5 contracts worth $3.6 million, while placing on hold 25 new contracts worth $59 million. Currently, there are 2,170 contracts on hold for the purchase of various humanitarian supplies and equipment, valued at approximately $5.3 billion. Of these, 1,484 contracts worth about $4.58 billion are for humanitarian supplies and 686 contracts worth $749 million are for oil industry spare parts and equipment.  

Paragraph 18 of the new set of procedures for the processing and review of contracts for humanitarian supplies and equipment under Security Council resolution 1409 (2002) requires that contracts currently on hold be divided into two categories.  The first category would comprise contracts that contain “dual use” item(s), as determined by the United Nations Secretariat experts, which will be returned to the submitting Mission or United Nations agency for possible re-submission under the new procedures.  The second category would include all other contracts currently on hold and will be re-circulated by OIP under the new procedures.  It is foreseen that upon the completion of these processes, there will no longer be contracts on hold.

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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