The United Nations Security Council has given Sec. Gen. Boutros Boutros Ghali a green light to use international oil companies to track hidden Iraqi oil money.
The U.N.'s Compensation Commission is charged with paying victims of Iraq's invasion of Kuwait and financing the disarmament of Iraq's war machine.
The commission has been operating with Iraqi assets that were frozen by other countries during the Persian Gulf war. It will pay about $4 million in claims this month but still be more than $150 million short of the $200 million in awards it wants to pay in the fall.
Boutros Ghali offered the security council a solution.
He said Iraq exported substantial volumes of oil just before the Security Council imposed sanctions, and payment would not have been completed when the sanctions took effect Aug. 6, 1990.
"While I have no independent information on the size of the sums which would have been due to Iraq for such shipments, reports from oil industry sources suggest that this amounts to hundreds of millions of dollars."
The U.N. has had little luck getting member countries to find those funds. Boutros Ghali said the oil industry would be better equipped to do the job.
EMBARGO RENEWED
In a separate action last week, the Security Council renewed its worldwide ban on Iraqi oil exports. Despite that, it was apparent the embargo will not last forever.
More than half of the 15 countries on the council have indicated they think Iraq has taken actions that will result in the embargo being lifted.
Russia and France argue that Iraqi President Saddam Hussein is making progress, and lifting the embargo would encourage further reforms.
The council has said the ban can be removed when Iraq's weapons of mass destruction are destroyed and when it recognizes Kuwait and their common border.
U.N. observers are expected to certify this summer that Iraq's nerve gases are destroyed. If Iraq allows arms inspectors to monitor its actions for several months, and if it recognizes Kuwait, the embargo could be lifted within a year.
TURKEY'S OIL CLAIM
Meanwhile, the U.S. is opposing Turkey's request that it be allowed to sidestep the embargo by selling 12 million bbl of Iraqi oil trapped in an export pipeline through Turkey.
Turkey owns about one third of the oil and Iraq the rest. Turkey said the sale would prevent damage to the line, which was shut down in 1991. It would keep title to the crude and pay Iraq with food and medical supplies.
The U.S. argues that U.N. resolutions require 30% of revenues from the sale of Iraqi oil to be given to the Compensation Commission.
A U.N. spokesman said last week, "The U.N. simply will not approve such a sale before the sanctions are lifted."
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