Publication: Monitor Volume: 2 Issue: 36

A Russian government official confirmed yesterday that Russia has concluded with Iraq some $10 billion worth of deals that will be launched as soon as UN economic sanctions against Baghdad are lifted. Last week representatives of Russia’s Fuel and Energy Ministry and the Zarubezhneft oil association had dismissed Iraqi news agency reports that set the value of the transactions at $10-$11 million. (see Monitor, February 15) The unnamed official said that most of the deals were in the oil and other energy sectors, but that several involved large industrial construction projects. The latter include power stations, a steel plant with an annual production capacity of 2 million tons, and factories to produce methanol and other chemicals. He added that Iraq had reaffirmed its readiness to repay its $7 billion debt to Moscow immediately upon lifting of the sanctions and that, under a preliminary agreement, payment would be in the form of hard currency and oil supplies. Bilateral trade, he predicted, could quickly climb to $1 billion per year. (6) Experts have suggested that Iraq, which possesses the world’s second largest oil reserves after Saudi Arabia, will quickly regain the markets for its oil lost since the imposition of UN sanctions that followed Iraq’s invasion of Kuwait in August 1990. (7)

Mixed Signals from Duma Committee Hearing on START II.