11-06-01 More than 100 flatbed trucks haul huge canisters of Iraqi fuel into Turkey almost every day, part of a massive operation that spans several countries and funnels an estimated $ 1 bn a year into Iraq. The United States is pressing to crack down on that trade, which violates UN sanctions. But at the bargain price that Iraq is offering his buyers, the effort may be futile, Turkish oil transporters and analysts say.
"If they cut it one way, it will come out the other way," said Bulent Aliriza, an analyst at the Washington-based Centre for Strategic and International Studies. "It is almost impossible to nail the door shut." Ending the trade would hurt US allies like Jordan and Turkey and devastate the economy of an autonomous Kurdish enclave in northern Iraq, where the revenue is one of its only sources of income.
Washington has long regarded the Kurds, who have fought Saddam for decades, as key to any anti-Saddam coalition. "The Americans are caught," said Ilnur Cevik, the editor-in-chief of the Turkish Daily News. "The US, while trying to stop the border trade to scuttle Saddam, has to allow the trade to help the Kurds." If you cut the trade "you finish off the Kurds and the so-called opposition," Cevik added.

The importance of the sanctions-busting trade to Iraq was highlighted, when Iraq announced that it was cutting off its UN-monitored oil exports but would continue to ship to neighbours who pay the government in violation of UN controls.
At Habur, the only border crossing between Iraq and Turkey, hundreds of trucks laden with Iraqi diesel waited in a 3.2 km-long line. In the first five days of June, 600 of the trucks crossed the border, said Abdullah Erin, the official in charge of the gateway. Each truck carries about 1,300 gallons.
"Iraq has a very successful program of sanctions-busting," said Toby Dodge of the Royal Institute of International Affairs in London. "It's partially how the regime gets its money."
Before the cut-off, Iraq sold some 2 mm bpd under the UN-monitored program, which requires that the money be spent on humanitarian goods like food and medicine, and as reparation for Iraq's 1990 invasion of Kuwait.
Some 150,000 bpd flow through Syria, while another 100,000 bpd of oil go to Jordan and Turkey, estimates Nathaniel Kern, an analyst with Foreign Reports, a Washington-based oil consultancy company. Kern said Iraq charges around $ 16 per barrel, a 30 % discount to the price that the nation charges through the UN program.
Traders said the discount was not that great. The Turkish trade has been falling recently, but truckers and analysts say that is due more to Turkey's economic crisis and complaints from oil companies about unfair competition than due to any crackdown.

Syria denies that it is illegally importing Iraqi oil, saying that it is only bringing in Iraqi crude to test an old pipeline from Iraq. Oil analysts, however, say that Syria is importing Iraqi oil and masking those imports by using the oil at home and exporting an equal volumeof its own oil. Turkey emphasized its dependence on the trade, which is estimated to support some 45,000 truck drivers in the southeast, when Prime Minister Bulent Ecevit visited the region and vowed to increase the trade.
"We know that the primary way to increase the region's income is the diesel trade," Ecevit said in Sirnak, an impoverished town near the Iraqi border where many of the truckers live. "We have decided to expand this, not narrow it," Ecevit added.
Turkey claims to have lost $ 30 bn to $ 40 bn US in trade since sanctions were imposed in 1990. A new border gate is expected to be opened within two years, Foreign Minister Ismail Cem said.
"If they close the border, we will die of poverty," said Yasar Evim, a Turkish truck driver who hauls crude oil from an Iraqi refinery in Mosul. He said he drives to Mosul each month to pick up the crude, which he must deposit at a refinery owned by the Turkish government. Turkish businessmen say they pay for the crude in bartered goods and not cash.

Diesel traders buy their fuel from the Kurds, who purchase it from Iraqi refiners. Turkish truckers pay the Kurds about 45 cents a gallon for the fuel, which they can sell at a government-owned depot for roughly $ 1.30 a gallon.
US warplanes that patrol a no-fly zone over northern Iraq are based in southern Turkey, and US diplomats said that Washington is looking at ways to tighten the sanctions without jeopardizing the border trade and angering Turkey. The US has tolerated the oil trade in the past because of its benefits to Turkey and Jordan.