Global Policy Forum

Increase in Iraqi Oil Smuggling


By Frank Gardner

BBC News
October 16, 1999

US naval forces in the Gulf say they are intercepting an increasing number of ships trying to smuggle goods out of Iraq in contravention of UN sanctions. A spokesman for the US Navy's Fifth Fleet headquarters in Bahrain has attributed the increase in sanctions busting to the recent recovery in the oil price. The maritime smuggling business is booming in the Gulf, making millions of dollars by illegally exporting Iraqi fuel oil and other goods southwards down the Gulf. Under the UN's oil-for-food programme, begun in 1996, Iraq is allowed to export limited amounts of its oil under international monitoring. But the recent recovery in the oil price from historic lows has tempted some Gulf shippers to resume smuggling cargoes of Iraqi's fuel oil which are not covered by the oil-for-food deal.


US, British and other warships regularly patrol the Gulf in an attempt to enforce UN sanctions. The US Navy's defence attache in Abu Dhabi, Commander Hasset, told the BBC that US warships have recently been intercepting an increasing number of illegal cargoes. He said two ships were impounded last week and were handed over to the United Arab Emirates coastguard.

Their cargoes are due to be sold with the proceeds going to the UN while the ships will be auctioned off. But despite US Navy commanders' optimism about their operations in the Gulf, there remains one loophole for smugglers which is apparently hard to close. Western naval officers maintain that Iran is allowing smugglers to use its coastline to evade UN patrols. They say that the business is so lucrative that smugglers can afford to pay off local coastguards in return for sheltering inside Iranian territorial waters beyond the reach of western navies.

Agricultural contracts

Meanwhile Iraq has accused the United States and the UK of delaying contracts signed under the oil-for-food programme to buy agricultural equipment. Iraqi Agriculture Minister Abdulillah Hameed Mahmoud Saleh said the agriculture sector, hit by the worst drought this century, was suffering from lack of revenues, machinery, pesticides and veterinary supplies. The UN Food and Agriculture Organisation's representative in Iraq, Amir Khalil, said purchases made under the oil-for-food programme had helped to improve the nutrition situation, but he also mentioned "difficulties in approving some of the agriculture items" bought by Baghdad under the deal. Mr Khalil said delays in approving some equipment related to concerns that they could be used for other purposes, such as producing weapons.

More Information on the Iraq Crisis


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