Iran really needs this small amount of oil from Iraq-do we not understand what is in play with this agreement?


Iran, Iraq sign deal to build oil pipeline
Web posted at: 8/12/2007 3:40:29
Source ::: AFP

tehran • Iran and Iraq signed an agreement to build pipelines for the transfer of Iraqi crude oil and oil products, Iran news network quoted the oil ministry as saying yesterday.

The 32-inch pipeline will bring crude from the southern Iraqi port of Basra to the southwestern Iranian port of Abadan. There will be a separately 16-inch one for oil products. Under the deal, Iran would buy 100,000 barrels of Iraqi crude to be refined in the southern port of Bandar Abbas, then sell the product back to Iraq. The report did not say when the pipeline will be built or who will pay for it.

Iraq has the world’s third-largest proven reserves of crude but has faced chronic shortages of refined products ever since the US-led invasion of 2003.