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Chalabi takes over Iraq oil ministry amid 'crisis'

Iraq's Deputy Prime Minister Ahmad Chalabi has assumed direct control of the powerful oil ministry as crude exports grind to a halt due to sabotage attacks and logistics problems, officials said on Friday.
/ Source: Reuters

Iraq's Deputy Prime Minister Ahmad Chalabi has assumed direct control of the powerful oil ministry as crude exports grind to a halt due to sabotage attacks and logistics problems, officials said on Friday.

Chalabi, who has been improving his relations with Washington after falling out with the U.S. administration, was appointed acting oil minister after the incumbent Ibrahim Bahr al-Uloum was given leave, the officials said.

Chalabi, who supported Uloum for the post when a U.S.-backed government was formed earlier this year, is already the head of the Oil Council, a cabinet-level board, and his influence on Iraq's economic and commodities policy is massive.

Uloum told Reuters he was "intent on resigning" while aides to Chalabi, a former financier, confirmed that he had been appointed acting oil minister.

"I object to the decision of putting me on leave and the mechanism by which it was done after I objected to the government's decision to raise fuel prices," Uloum said.

The son of a prominent Shi'ite theologian, Uloum has been directing the ministry's efforts towards solving fuel shortages triggered by sabotage and breakdowns that plagued Iraq since Saddam Hussein was removed from power more than two years ago.

A ministry spokesman allied to Uloum said the country was facing what he called an impending oil supply crisis. "Production in the north, centre and south is about to suffocate," he said.

Falling oil exports and fuel shortages, especially of gasoline, have raised the level of popular frustration with the performance of successive Iraqi governments since Saddam's rule.

South Iraq's oil exports, which constitute the bulk of the country's production, remained shut on Friday due to logistics problems at the Basra terminal in the Gulf.

A regional shipper said tugs at the terminal broke down a few days ago and were undergoing repair, adding that no tankers had been loading from Basra for about a week. Bad weather, which has now cleared, also contributed to the halt.

Shipping data showed the tanker Queen Way still sitting at Basra's berth number one although it finished loading one million barrels of crude oil on December 25.

The tanker Kos was also waiting for a tug at Berth number three. It finished loading two million barrels on December 20.