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Iraq back in the oil biz
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December 9, 1996: 7:05 p.m. ET
United Nations allows Iraq to resume oil sales for a six-month period
From Correspondent John Defterios
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NEW YORK (CNNfn) -- Iraq is back. The United Nations on Monday announced it would allow Iraq to sell $2 billion worth of oil over a 180-day period.
Iraq has spent more than six years under sanctions after its invasion of Kuwait which triggered the Persian Gulf War.
The news was good for Iraq, but it hardly caused a blip on the oil markets.
Worldwide oil production currently runs at roughly 72 million barrels per day. Iraq will add roughly 600,000 barrels a day to that total.
Oil analyst Paul Ting of Salomon Brothers said the new production from Iraq will have little impact on prices for now. (281K WAV) or (281K AIFF)
The Iraqi oil should hit the market in late December and the Iraqis are ready and eager to sell.
"I don't think it will be sufficient but it will be significant in alleviating some of the hardships of the Iraqi people," said Nizar Hamdoon, Iraq's ambassador to the United Nations.
The deal has been discussed since the end of the Persian Gulf War.
Iraq's re-admittance to the market comes at a time of strong prices and analysts believe that price trend will continue. That trend, coupled with aggressive cost-cutting in the industry makes oil company stocks attractive.
"The operating environment for the whole oil industry has probably not been this good for several decades," noted Oil Analyst Sal Illacqua of Rothschild.
One problem that looms ahead is that Iraq is not satisfied with 600,000 barrels per day and will soon be seeking a reestablishment of its old daily quota of 3 million barrels.
That may be a matter not only for the United Nations to decide, but also for Iraq's partners in the Organization of Petroleum Exporting Countries (OPEC) as well. 
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