UN Likely to Let Iraq to Get Euros for Oil Exports
October 28, 2000 - 0:0
UNITED NATIONS UN Security Council members appear likely to allow Iraq to receive payment for its oil exports in Europe's single currency rather than U.S. dollars, diplomats said on Thursday.
"In principle, we have no problem with it," said one member of the council's sanctions committee on Iraq. "There is nothing in the resolution that says what currency is to be used." Iraq has already threatened to stop oil exports, the bulk of which flow through the UN humanitarian program, if its request for payment in the euro is denied.
Baghdad currently is selling about $60 million of oil per day.
Its 2.3 million barrels per day (bpd) of crude oil comprise some five percent of the world's supply.
Iraq, which has called the dollar the currency of its "enemy state," informed oil customers earlier this month to start making payments in euros, beginning Nov. 1.
Under the so-called UN oil-for-food program, Iraq is permitted to sell unlimited quantities of oil to purchase needed supplies for its 23 million people to alleviate the impact of UN sanctions.
The embargoes were imposed when Baghdad's troops invaded Kuwait in August 1990.
Contracts for goods as well as oil sales are approved by the United Nations, which has a dollar-based escrow account at the New York branch of the French bank BNP-Paribas. More than $10 billion is currently in the bank..
Iraq's move also comes at a time the euro on Thursday hit an all-time low of 82.3 cents to the dollar.
On Thursday, UN staff issued a still undisclosed report to the committee on the financial implications of a switch to euros for crude oil, which is bought and sold around the world in U.S.
dollars.
The committee is expected to consider the report on Monday.
In Washington, the White House said it made no difference to the United States which currency Iraq used.
"I don't think it matters" whether Iraq takes euros for oil rather than dollars," National Security Council spokesman P.J. Crowley said.
"What's important is that the oil-for-food program continues.
We're going to continue to support the oil-for-food program, but as to the specific currency, I don't think it matters," he said.
"The fact is that whether it's in euros or dollars, we have control of his (Iraqi President Saddam Hussein's) pocketbook, so that we make sure that the revenue from the oil-for-food program is used for food and medicine and not for tanks," Crowley added.
(Reuter)
"In principle, we have no problem with it," said one member of the council's sanctions committee on Iraq. "There is nothing in the resolution that says what currency is to be used." Iraq has already threatened to stop oil exports, the bulk of which flow through the UN humanitarian program, if its request for payment in the euro is denied.
Baghdad currently is selling about $60 million of oil per day.
Its 2.3 million barrels per day (bpd) of crude oil comprise some five percent of the world's supply.
Iraq, which has called the dollar the currency of its "enemy state," informed oil customers earlier this month to start making payments in euros, beginning Nov. 1.
Under the so-called UN oil-for-food program, Iraq is permitted to sell unlimited quantities of oil to purchase needed supplies for its 23 million people to alleviate the impact of UN sanctions.
The embargoes were imposed when Baghdad's troops invaded Kuwait in August 1990.
Contracts for goods as well as oil sales are approved by the United Nations, which has a dollar-based escrow account at the New York branch of the French bank BNP-Paribas. More than $10 billion is currently in the bank..
Iraq's move also comes at a time the euro on Thursday hit an all-time low of 82.3 cents to the dollar.
On Thursday, UN staff issued a still undisclosed report to the committee on the financial implications of a switch to euros for crude oil, which is bought and sold around the world in U.S.
dollars.
The committee is expected to consider the report on Monday.
In Washington, the White House said it made no difference to the United States which currency Iraq used.
"I don't think it matters" whether Iraq takes euros for oil rather than dollars," National Security Council spokesman P.J. Crowley said.
"What's important is that the oil-for-food program continues.
We're going to continue to support the oil-for-food program, but as to the specific currency, I don't think it matters," he said.
"The fact is that whether it's in euros or dollars, we have control of his (Iraqi President Saddam Hussein's) pocketbook, so that we make sure that the revenue from the oil-for-food program is used for food and medicine and not for tanks," Crowley added.
(Reuter)