3.2 |
Development of UK strategy and options, January to April 2002 –
“axis of evil” to Crawford
•
Iraq could
“survive for several months at least and possibly several
years”
without any
oil income, as it had between 1991 and the end of
1996.
•
The
contribution of revenues from OFF was not “regarded as necessarily
crucial
to regime
survival”.
•
Removal of
access to revenue from illegal oil exports would be a “more
direct
threat to
the regime”.
•
There had
been considerable successes in limiting oil smuggling through
the
Gulf, but
it had “proved politically impossible to counter effectively Iraq’s
other
illegal oil
exports”.
•
While a
sudden cut in Iraqi oil exports would probably cause a temporary
spike
in the oil
price, the price rise would be “moderate” (less than US$5 per
barrel).
•
Market
expectations would be a key factor in determining the duration of
the
spike. They
were already influenced by “jitters over the Middle East and
talk
of war
with Iraq”.
532.
When Iraq
announced on 8 April that it would halt oil exports under the
UN
Oil‑for‑Food
programme for 30 days “or until Israel withdraws from
Palestinian
territories”,
Mr Blair was advised that the market had already factored in
the possibility
of
disruption given the situation in the Middle East and the
possibility of from an Iraqi
suspension
of exports around the UN discussion of sanctions at the end of
May.198
533.
Mr Blair
discussed the need for a strategy to remove Saddam Hussein
and
possible US
military action in a meeting at Chequers on 2 April
2002.
534.
The meeting
was clearly intended to inform Mr Blair’s approach in
his
discussion
with President Bush.
535.
Following Mr
Blair’s request in his minute of 17 March for a meeting with
military
personnel,
a meeting was held at Chequers on 2 April. No formal record was
made of
the
discussion or who was present.
536.
Accounts given
by participants suggest that Admiral Sir Michael Boyce, Chief of
the
Defence
Staff (CDS), Sir Kevin Tebbit, MOD Permanent Under Secretary
(representing
Mr Hoon
who was unable to attend), Lieutenant General Sir Anthony Pigott,
Deputy
Chief of
the Defence Staff (Commitments), Lieutenant General Cedric Delves,
senior
UK liaison
officer at CENTCOM, Sir Richard Dearlove, Mr Powell, Sir David
Manning
and
Mr Scarlett were present.
198
Minute
No.10 [junior official] to Prime Minister, 8 April 2002, ‘Iraq
Suspends Oil Exports; Impact
on the Oil
Markets’.
483