Iraq predicts crisis in oil market if exports cutgreenspun.com : LUSENET : Grassroots Information Coordination Center (GICC) : One Thread
Iraq predicts crisis in oil market if exports cut
BAGHDAD, May 27 (Reuters) -A senior Iraqi energy official was quoted on Sunday as saying any suspension of Iraqi crude exports would cause a crisis in the world's oil market.
Oil Ministry senior undersecretary Taha Humud Musa, quoted by Ittehad newspaper, said it was unlikely that Saudi Arabia would be able fill the void if Baghdad halted its exports.
"We doubt that Saudi Arabia would compensate for Iraqi oil in the case exports were halted. The Saudis might have a production surplus but this is not enough," Musa said. "We are sure that if Iraqi crude is absent (from the market), there will be a crisis and then we'll see," he said.
Baghdad has threatened to halt oil exports if the U.N. Security Council adopts the "smart sanctions" proposal of Britain and the United States.
Iraq currently exports about 2.1 million barrels per day. Washington's aim is to get the resolution adopted before the current six-month phase for the United Nations oil-for-food programme expires on June 3.
But with two permanent members of the Security Council - Russia and China - balking, an extension of the current phase looks likely. Iraq wants a simple renewal of the current programme. The British-U.S. plan seeks to ease restrictions on civilian goods going to Iraq but also to crackdown on oil smuggling.
OPEC kingpin Saudi Arabia has said that it and other OPEC members would step in and fill any serious supply gaps created by a break in Iraqi exports.
An Iraqi oil official said on Sunday Iraqi Oil Minister Amir Muhammed Rasheed and top oil officials were due to attend OPEC's June 5-6 output strategy meeting in Vienna. Rasheed's entourage is to include Musa, Saddam Hassan, executive director of oil marketer SOMO, Abd al-Ilah al-Tikriti, director general of economics and finance, and Mus'ib al- Dujail, OPEC governor and adviser to the oil minister.
The Iraqi oil minister has previously given OPEC meetings a miss when domestic affairs have taken precedence.
-- Martin Thompson (firstname.lastname@example.org), May 28, 2001
If Iraq follows through on this threat, it would likely be the Moment of Truth regarding Y2K embedded system bottlenecks in the oil extraction industry: Can Saudi Arabia increase production enough to make up for lost Iraqi oil?
However, it is unlikely we'll find out. The reason is that, if the powers that be believe it could expose Y2K problems, then Iraq's bluff won't be called. Or, a scapegoat will be quickly generated, such as a limited Middle East War (there are other possibilities). Maintenance of the Grand Y2K Cover Up that started in late February 1999 is a top priority for the powers that be. Faith in Information Technology must not be shaken!
-- Robert Riggs (email@example.com), May 28, 2001.