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20 August 2002
Oil-for-Food Background Information


Weekly Update

(10-16 August 2002)

While still well below recorded average rates, the level of Iraqi oil exports under the United Nations oil-for-food programme was up from the previous week’s total of 4.4 million barrels to 7.2 million barrels in the week ending 16 August 2002.  Netting an estimated €186 million (euros) or $181 million in revenue, at current prices and rate of exchange, the week’s exports were completed through three shipments each from the authorized loading terminals of Mina al-Bakr terminal and Ceyhan. The average price of Iraqi crude oil was approximately €24.60 or $24.10 per barrel. 

 Since the beginning of current phase XII of the programme on 30 May 2002, Iraq has exported almost 79 million barrels of oil out of 328 million barrels approved by the United Nations oil overseers under 147 oil purchase contracts.  The estimated revenue generated so far in this phase is €1.92 billion or $1.88 billion. Phase XII ends on 25 November 2002.

 A cumulative revenue shortfall since phase VIII of the programme has left 1,116 approved humanitarian supply contracts, worth about $2.26 billion without available funds. A phase usually lasts six-months. The sectors affected by the revenue shortfall are: electricity with $386 million; agriculture with $330 million; food with $307 million; housing with $293 million; food handling with $291 million; water and sanitation with $232 million; telecommunications and transportation with $149 million; health with $147 million and; education with $121 million.

 Iraqi oil exports of some 3.1 billion barrels since the beginning of the programme on 10 December 1996 have generated an estimated revenue of about $38.6 billion and €19.5 billion ($17.5 billion). While initially 66% of oil proceeds went to fund the humanitarian programme, since December 2000 the programme’s share of the oil revenue is 72%. To date, some $36.4 billion worth of humanitarian supply contracts have been approved by both the Security Council’s 661 sanctions committee and the Office of the Iraq Programme (OIP), including about $3.3 billion worth of oil industry equipment.  Of the approved contracts, almost $24 billion worth of supplies and equipment have been delivered to Iraq, including $1.5 billion worth of oil industry equipment.  An additional $9.8 billion worth of supplies, for which funds have been available, are in the production and delivery pipeline, including $1.8 billion worth of oil industry equipment. 

 With the implementation of the new set of procedures under resolution 1409 (2002) as of 15 July 2002, some $41 million worth of supplies under 60 contracts previously on hold by the 661 Committee, have now been re-assessed as not to contain Goods Review List (GRL) items and therefore, approved by OIP. There remain 2,001 humanitarian supply contracts on hold, worth about $5.01 billion.

Paragraph 18 of the new set of procedures under resolution 1409 (2002) divides contracts on hold into two categories. The first category comprises contracts that contain “dual use” item(s), as determined by the United Nations Secretariat experts, which are returned to the submitting Mission or United Nations agency for possible re-submission under the new procedures. The second category includes all other contracts on hold which are re-circulated by OIP under the new procedures. The re-circulation of these contracts will be completed by 15 September.  It is foreseen that with the end of this process, 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