The world media have been searching for fresh news on the Iraqi issue for quite some time, but now they have cheered up again. The Washington Post newspaper stirred everything up when it published a long article devoted to the issue of an economic deal between Moscow and Baghdad.

As the newspaper wrote, Moscow and Baghdad are going to sign a long-term agreement regarding economic cooperation. The deal is evaluated in the sum of 40 billion dollars. The agreement is to cover a period of ten years. It includes 67 contracts in the fields of oil and gas extraction, transportation, and communication.

The Russian government has confirmed the information. Aleksey Volin, deputy chief of the governmental administration, stated that the deal includes bilateral cooperation in various fields. “Our logic is presumably based on economic interests. Moscow has never concealed the fact that the UN’s economic sanctions cause damage not only to Iraq, but to Russia as well. Baghdad’s losses added up to some 400 billion dollars since the moment when the sanctions were first instituted.”

Iraq holds the second place in the world in terms of oil extraction. This country is also a very large source of natural gas for the countries of the region. Moscow has actually monopolized both the current oil extraction and its reserves after the introduction of the sanctions.

By the end of 1997, Russian firms signed contracts for the development of oil deposits in Iraq for a total of $3.5 billion. Currently, Russia is the largest consumer of the Iraqi crude. Russian companies control the concessions, which make up billions and billions of dollars.

These actions allow Russia to control almost one-third of the developed oil deposits in Iraq. These oil reserves are evaluated to be around 650 billion barrels. Russia also controls one half of the developed gas reserves in Iraq: 1800 trillion cubic feet.

If these figures are added to Russia’s reserves (about 50 billion barrels of crude) and to the Caspian reserves, then Moscow is likely to dictate its own conditions, not only to Europe and the Commonwealth of Independent States, but even to Washington.

As you can see, there is something here to struggle for. However, it would be foolish for Moscow and Baghdad to believe that Washington will give up on Iraqi oil. Bush might think, not twice, but twenty times before striking Iraq. However, this will only be a delay.

Russian petroleum companies are actively working in European and American markets. They are not at all willing to have problems with Washington. The newspaper Vremya Novostey wrote: “If Moscow has the nerve to sign this plan, then Russia will be in the track of American politics all the same. Russian petroleum companies claim that they cannot take oil out of Iraq. They say that this is unprofitable due to the special price policy of London and Washington. Russian diplomacy is unable to stand up against them. Russian petroleum companies are more drawn to cooperation, not with Iraq, but with Kuwait. LUKOIL does not actually believe that it will develop the giant West Qurna deposit in Iraq. International sanctions by the USA do not allow this, no matter what documents are signed.

The given agreement can be considered not from an economic, but from a psychological point of view. This is enough to present economic claims to Washington regarding this region of the world. Second, it is enough to give food for thought to the Europeans who are rushing between Moscow and Washington.

Baghdad guessed correctly regarding Russia. Iraqi Ambassador to Russia Abbas Khalaf said: “First of all, we need moral, political, and diplomatic support, because Iraq knows how to defend itself." Russia’s penetration into Iraq means that there will soon be thousands of Russian specialists on the territory of the “axis of evil." This will present more problems for the USA. It will be hard for Washington to bomb Russians in Iraq when Russia is one of America's allies in the anti-terrorist coalition.

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