Saddam provoking crisis to dramatize UN sanctions

By Paul Taylor

LONDON (Reuters): Iraqi President Saddam Hussein may be chuckling as he weighs his options to provoke a crisis ahead of the United States presidential election to dramatize his opposition to UN sanctions.

By sending a few planes to challenge a U.S.-policed no-fly zone and reviving old accusations that Kuwait is stealing Iraqi oil, he has succeeded in rattling a tense world oil market and reminding the West of his ability to cause nasty surprises.

Most Western and Arab analysts do not believe Saddam wants a major confrontation with the United States.

They see his aim as to embarrass President Bill Clinton in the run-up to the Nov. 7 election and play on divisions among Western states and between the West and the rest of the world over maintaining sanctions and imposing huge reparations payments on Iraq for its 1990-1991 occupation of Kuwait.

Experts say Saddam has multiple options for pursuing this agenda, of which the much-feared withholding of Iraqi oil supplies from tight world markets is not the most likely.

In descending order of probability experts say he could:

-- send his army to recapture a key city held by Kurdish rebels

-- step up provocations in the no-fly zones over northern and southern Iraq in hopes of shooting down a U.S. aircraft or goading Washington into controversial retaliation

-- thumb his nose at the West by inaugurating regular commercial airline flights with Russia

-- provoke heightened tensions with Iran, for example by prompting more attacks by Iraq-based Mujahideen Khalq in Tehran

-- stage troop movements in southern Iraq to raise tension

-- threaten to withhold some oil exports in connection with demands over sanctions or compensation payments.

"Iraq sees this as a good time to pressure the international community because of rising oil prices, protests over oil prices in Europe and the U.S. presidential election," said Mustafa Alani, a London-based Iraq analyst.

"Since both George W. Bush and Al Gore are committed to maintaining sanctions and working to remove his regime, what does Saddam have to lose?" he asked.

Alani said the most obvious target for Saddam would be to send two Republican Guard divisions based in the oil city of Kirkuk to recapture the Kurdish-held city of Arbil, as they did briefly in 1996, driving out U.S.-backed Iraqi opposition groups in a rout that deeply embarrassed Washington.

Such a move would be difficult for the U.S. and Britain, its trusty ally against Iraq, to stop by using air power, although it might well trigger a punitive airstrike against strategic targets in Baghdad.

Secretary of State Madeleine Albright earlier this month cited an attack on the Kurds as one of the "red lines" that could prompt a U.S. military response.

Alani said the U.S. had made clear it did not want a confrontation with Iraq before the election, giving Saddam some room to "make trouble" without having to fear massive retaliation.

He did not rule out the possibility of Iraq creating some political crisis over Kuwait, or reparations payments, and then threatening to keep its estimated 2.3 million barrels a day in oil exports off the market.

Oil analysts say the mere threat of such a move would immediately hit politically-sensitive oil prices.

But another Iraq expert, U.S. National Defense University analyst Judith Yaphe, questioned whether Saddam needed to use the oil weapon to achieve his objectives.

"I think he's going to continue probing for weakness. He's pushing the envelope to see how far he can go. He's trying to tell the world: 'you need me, you're going to have to deal with me'," she said. "He's most likely to keep probing, trying to rattle everyone, until he draws a response."

The tactic could prove effective at a time when the U.S. was unlikely to actively go after Saddam.

Yaphe said the Iraqi threats and overflights were probably linked to forthcoming deliberations over a huge claim for reparations from the Kuwaiti oil company, which a United Nations committee is due to assess in Geneva next week. Russia and France have held up consideration of the US$21.5 billion claim so far.

Iraq is also pressing for a reduction in the percentage of its oil revenue which is automatically deducted by the UN to meet compensation claims. Russia has proposed cutting it to 20 percent from 30 percent.

The renewed tension with Iraq comes amid speculation in Western media and among some diplomats about Saddam's health.

Signs that the Iraq leader has lost weight have prompted some reports that he may be suffering from cancer, but Western intelligence sources said Saddam keeps a full schedule and they have seen no convincing evidence that he is ill.

While Saddam's tactics have proved effective in creating tension, they have not endeared him to France, the Western member of the UN Security Council most sympathetic to Iraq.

Foreign Minister Hubert Vedrine said he tried in vain last week to persuade Iraqi Deputy Prime Minister Tareq Aziz that Baghdad's best interest was to cooperate with UN arms inspectors if it wanted to get sanctions lifted soon. He said Aziz showed no movement and they made no progress.

Despite a recent call by Egyptian Foreign Minister Amr Moussa for sanctions to be lifted, Western officials say there is still strong support among Gulf Arab governments for continuing to isolate Iraq as long as Saddam refuses to cooperate with the elimination of Iraq's residual chemical and biological weapons programs.

So while Saddam may be able to create tension, he still seems a long way from achieving his objective of forcing an end to sanctions, the analysts say.