Global Policy Forum

Russia wants to be an equal partner in any privatization of Iraq's oil sector if the United States launches military action and topples the regime of Iraqi President Saddam Hussein, an adviser to Russian Vladimir Putin said Friday.

"We have interests in the oil sector of the Iraqi economy," said Mikhail Margelov, chairman of the international affairs committee of Russia's Federation Council, or upper house. "When I say interests, I do not mean only honoring the current contracts which exist, but also an opportunity for equal, fruitful cooperation between the international oil companies and the Russian oil companies in future, especially in the privatization of the Iraqi oil sector," he added.

Margelov, on a visit to Washington where he met members of Congress, said Moscow was also concerned about Iraqi debt to Russia, estimated between $7 billion and $12 billion.

"This debt has to be repaid and Russia definitely needs guarantees from our partners that this position is being recognized and respected," he told reporters at a briefing in the Russian embassy where an official announced him as a close adviser to Putin on foreign policy, including Iraq. Margelov did not explicitly link guarantees on oil and debt to Russian acquiescence in discussions at the U.N. Security Council on a new resolution on Iraq.

U.S. President Bush wants a tough new resolution to threaten Saddam with force if he fails to give U.N. inspectors full access to suspected arms sites, but Moscow wants to rely on old U.N. resolutions and to send inspectors into Iraq quickly.

Margelov said Russia had four key concerns on Iraq -- the debt, oil, the threat of an Arab-Kurdish conflict erupting and Islamic fundamentalists assuming power post-Saddam.

"The recognition of the Russian interests in the oil sphere in Iraq should not be only recognition by U.S. officials but also recognition from the international oil community and actually I think the discussion in this direction is going on," in the U.S., he said.

He said Iraqi oil could not be shared out by just one or two countries. "The competition should be open to everybody."

Asked what the U.S. had to say to satisfy Moscow on oil and debt, he replied: "As soon as we are satisfied with the American message I will tell you. We are working on that." Margelov noted Russia had multi-billion-dollar former Soviet debt to the Paris Club and German and American banks, while being owed money by many countries itself.

"I don't think that international monetary organizations will be ready to deduct Iraqi debt to Russia from former Soviet debt, but why not?" he said.

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