Iraq sells 9.8 million barrels of crude, but UN oil-for-food scheme still faces shortfall

Iraq last week exported 9.8 million barrels of crude under the United Nations oil-for-food programme, which allows Baghdad to use a portion of its petroleum revenues to purchase humanitarian relief, but a major funding gap still persists, the UN reported today.

Averaging 1.4 million barrels exported per day, Iraq earned an estimated €261 million (euros), or $258 million, in revenue in the week ending 4 October, according to the UN Office of the Iraq Programme. The average price of Iraqi crude was €26.65, or $26.30, per barrel.

The Government has a $5 billion budget to meet humanitarian needs during the current phase of the programme. Under the oil-for-food scheme, only a portion of the revenue goes to the humanitarian effort – with the rest set aside for other Iraq-related activities, including a compensation fund for those who suffered damages as a result of the country’s 1990 invasion of Kuwait – so Baghdad would actually have to sell about $7 billion worth of oil to reach the target. But far from achieving that goal, Iraq is only on track to earn $4.2 billion during this phase, generating just $3 billion for the humanitarian programme.

A similar revenue shortfall from earlier phases has left humanitarian supply contracts worth over $2.56 billion without funds, the Office of the Iraq Programme said.