Iraq's oil industry crippled by attacks on pipelines

IRAQ’S oil industry was left crippled yesterday by attacks on pipelines in the north and south of the country, in a warning to the incoming Iraqi government of how fragile its economy will be.

Early yesterday, saboteurs blasted two pipelines on the Faw peninsula of southern Iraq, forcing authorities to cut exports through the Gulf by more than half.

Later in the day, an explosion ripped through a pipeline linking northern Iraqi oilfields, a North Oil company official said, adding: "It was probably sabotage."

Witnesses said fire was still raging last night in the pipeline running from Disi to a pumping station near the city of Kirkuk, 30 miles to the west.

Iraqi officials said they expected to have the damage in the south repaired within a few days. However, Paul Horsnell, the head of energy research at Barclays Capital in London, said that as a result of the blasts Iraq would probably fail to meet its export target of two million barrels a day for June.

Reviving petroleum exports is the key to restoring Iraq’s economy after decades of war, international sanctions and Saddam Hussein’s tyranny. But repeated attacks have slowed the process of returning Iraq - which has the world’s second-largest petroleum reserves after Saudi Arabia - to the forefront of global energy markets.

The attacks appear to be part of a series assaults on the nation’s infrastructure to undermine confidence in the new government, which takes power on 30 June. On Monday a car bomb killed 13 people in Baghdad, including three foreign engineers working to restore electricity supplies.

Brigadier-General Mark Kimmitt, the coalition deputy operations chief, said another convoy of contractors was ambushed yesterday in Baghdad and that "some" people had been killed.

A car bomb exploded yesterday outside a coalition base near Hillah, south of Baghdad, killing one Iraqi and wounding another, the United States military said.