Saddam to 'swallow his pride' on oil offer

SAFA HAERI

Paris

DAVID USBORNE

New York

President Saddam Hussein agreed to open new talks with the UN on limited oil sales only after he had been convinced that there was no possibility of change in the US insistence on sanctions, according to Middle East sources.

President Saddam was told bluntly by a team of ministers led by the veteran Tariq Aziz, the influential Deputy Prime Minister, that Iraq had a choice: either to "swallow its pride and accept the UN offer or to face a nationwide uprising," the source said, as the country is desperate for money.

This suggests that negotiations which open in New York today may finally result in agreement between the United Nations and Iraq on oil sales. At stake is Resolution 986 of the UN Security Council, which would permit Iraq to export up to $1bn (pounds 660m) of oil every 90 days for a 180-day period on condition that the proceeds are used to pay for the country's humanitarian needs.

Until now President Saddam has systematically ruled out any such conditional negotiations, pointing out that they violated Iraqi sovereignty, and pressed for a relaxation of sanctions. But "he was told by [Tariq] Aziz that he should not count on any change in Clinton's position concerning Iraq during an election year, no matter what pressure France, Russia and China might exercise in the Security Council", the source added.

Diplomats at the United Nations were cautioning yesterday that they did not expect talks with Iraq on allowing it to export limited quantities of oil for humanitarian reasons to be either easy or quick.

"There is no sense of optimism," remarked one European diplomat who will be monitoring the negotiations. "We are in a wait-and-see mode, because I don't think any of us yet know whether Iraq is really serious about this. The only person who does know is probably Saddam Hussein himself."

The United States reiterated at the UN yesterday that the provisions in the resolution itself were not open for renegotiation. The resolution includes conditions that a majority of the oil be exported via a pipeline through Turkey to the Mediterranean; that 30 per cent of what Baghdad earns be set aside to pay claims against Iraq arising from the Gulf war; and that at least $130m of the revenues in each 90-day period be assigned to Iraqi Kurds. The whole operation, meanwhile, would be overseen by the UN.

The negotiations will begin this morning behind closed doors at the UN headquarters and are expected to take days and possibly weeks. "We expect them [the Iraqis] to drag this out with all kinds of objections on technical and sovereignty questions," one official said.

The Iraqi team will be led by Abdul Amir al-Anbari, the present Iraqi envoy to Unesco in Paris. One of Iraq's most able and senior diplomats, Mr Anbari performed well at the UN during the difficult days of the Gulf war.

Foreign diplomats based in Baghdad said yesterday that they saw signs Iraq was preparing to soften its position.

Official media in Baghdad mentioned Resolution 986 without criticism for the first time yesterday. Iraqi authorities have also been stressing the preparations they have made to load tankers at terminals in the northern Gulf. Iraq said on Sunday that two of its tankers were ready to supply fuel to ships calling at Iraqi ports, the official Iraqi News Agency reported.