Saddam Rattles His Saber

A T H E N S, Greece, June 18, 2001 -- As the United Nations debates an overhaul of sanctions against his embattled country, Iraqi President Saddam Hussein's saber rattling against the United States appears to have reached a fever pitch.

While successfully dodging the U.N.-imposed sanctions against Iraqi oil exports, Saddam and his two sons and heirs, Qusay and Uday, have been talking and acting as though Baghdad was actually preparing for a new armed confrontation with the West.

On Sunday, Iraq's ambassador to the United Nations told U.S. television that Baghdad was offering a reward to Iraqi military officials for shooting down allied aircraft patrolling Iraq's "no-fly zones."

The declaration came amid growing border tensions with Saudi Arabia — an important Arab ally of the United States — and Iraqi threats to reject the new British proposed "smart sanctions" currently being debated in the United Nations.

The new "smart sanctions" are a British-U.S. proposal to ease restrictions on civilian imports to Iraq but toughen a ban on military-related goods. The proposal, to be decided by the U.N. Security Council by July 3, also aims to put an end to smuggling and illegal trade between Iraq and its some of its neighbors.

Border Problems

Iraq's issues with Saudi Arabia — border incidents, oil and natural gas — are familiar to Middle East observers who remember the 1990 buildup to Saddam's invasion of Kuwait.

Although largely unreported in the Western media, Saudi Arabia recently seized a disused Iraqi-owned oil pipeline running through Saudi territory for its own use.

According to the Saudi government-controlled media, the Arab kingdom plans to use the seized pipeline to transport natural gas across the desert to export markets after repairs and technical alterations have been carried out.

In a statement issued by the official Iraqi News Agency (INA) today, an Iraqi Foreign Ministry official dismissed Saudi ownership claims of the pipeline, saying the pipeline "was built according to agreements signed between Iraq and Saudi Arabia in the 1980s." He also added that Iraq had paid more than $2 billion for its construction.

Saudi Arabia recently concluded new deals for production, transport and processing of its natural gas with major U.S. and multinational firms, including Exxon-Mobil and Shell.

Much of the seized $2.2 billion Iraqi pipeline, built in the 1980s to carry Iraqi crude oil from the Gulf westward to the Saudi Red Sea port of Yanbu , runs parallel to an earlier Saudi pipeline.

Saudi King Fahed ordered the Iraqi line disconnected after Iraq invaded Kuwait, whom Saddam accused of stealing Iraqi oil, in August 1990. It has not been used since.

Iraq has denied the reported border incursions against the Saudis and has told the United Nations it will demand compensation for the "hostile" act of seizing the pipeline.

A Price on a Head

Baghdad's recent diplomatic troubles with Riyadh came as Mohammed al-Douri, Iraq's ambassador to the United Nations, confirmed allied suspicions that Saddam was offering a reward to its soldiers for downing U.S. or British planes.

"This is a way to encourage people to do their jobs better than usual," he told NBC News on Sunday.

The declaration followed an Iraqi news agency report that Saddam had warned his uniformed Cabinet members that Baghdad was heading for "a major confrontation with the aggressors" and must prepare to fight a new "national independence battle" and win it.

But even as Baghdad has repeatedly said it would reject the new "smart" sanctions proposal by the U.S. and Britain, Saddam has been successfully defying international attempts to halt the so-called "smuggling" of oil to neighbors like Turkey, Syria and Jordan, most of it outside the U.N.-regulated oil-for-food program.

Profitable ‘Unofficial’ Trade

Although Iraq has halted its 2.2 million barrels per day oil exports under the oil-for-food program, according to the authoritative oil journal Middle East Economic Survey (MEES), Baghdad continues its profitable 300,000 barrels per day "unofficial" trade with its neighbors.

Iraqi officials have halted exports under the oil-for-food program ostensibly because the United Nations renewed the program for only one month — and not six months as Iraq demanded.

In the past few months, Iraq has signed a number of new oil transactions with countries such as Syria, Algeria and India, which are not regulated by the United Nations.

The increased oil trade, coupled with cross-border exports to Turkey and Jordan, come as Iraqi opposition sources in Europe warn that Saddam is beefing up Iraqi military forces near Kurdish-controlled areas of northern Iraq, as well as continuing to improve his anti-aircraft defenses against U.S. and British planes based in Turkey, Kuwait and Saudi Arabia.