Iraq has warned of a crisis on the world oil market if Baghdad's crude exports are interrupted because of a freeze on the UN-supervised oil-for-food programme, saying Saudi Arabia would be incapable of making up the difference.
"We are certain that if Iraq's oil stops flowing, there will be a crisis on the world market," said Taha Hammud Mussa, secretary to the Iraqi oil ministry, quoted in AlIttihad newspaper.
"I doubt that the Saudi kingdom could compensate a lack of Iraqi oil if there were a break in exports," said Mussa, adding that Iraq's production capacity would soon be raised to 3.5 million barrels per day.
The oil-for-food programme was introduced in 1996 and allows Baghdad, which has been under sanctions since invading Kuwait in 1990, to export crude to pay for imports of humanitarian supplies, war reparations and UN operations in Iraq.
Iraq's Deputy Prime Minister Tareq Aziz on Wednesday renewed the threat to halt oil exports under the programme, depriving the world market of around two million barrels a day, if Washington amends the humanitarian scheme.
"If the Security Council adopts the project which has been submitted, the Iraqi government will not sell a single barrel of oil under the oil-for-food programme," he said.
But the US State Department on Tuesday already rejected Baghdad's threatened retaliation against a US-British proposal to maintain strict controls on military sanctions against Iraq while easing those on consumer goods. AFP