Amman: Jordan plans to resume importing cheap oil from Iraq, the Jordanian prime minister announced yesterday, bringing a three-year hiatus to an end under a deal that envisions setting up a pipeline between the neighbours.

Jordan is one of a few Arab countries that does not have significant oil reserves.

It hiked fuel prices three times in the past year the last time in April, almost doubling fuel costs for consumers. An additional increase is expected next March.

Prime Minister Marouf Al Bakhit said the oil would be bought at 'international market price, minus an unspecified number' referring to a preferential price, which economic analysts believe may be as much as $10 (§7.9) lower than on the international market. He declined to reveal figures.

Al Bakhit announced additional details of the deal that was first revealed in August in Baghdad. Jordan will import 10,000 barrels per day (bpd) about one-tenth of its daily requirements. He did not say when importing would resume.

At a later stage, Jordan will increase the figure to 30,000 bpd and that amount could be doubled, the prime minister told reporters.

Before the 2003 US-led invasion of Iraq, Jordan received all of its oil from its neighbour at highly preferential prices under Saddam Hussain's regime.

Iraq will give Jordan a discount because of their close ties and its history of providing its neighbour with inexpensive oil.

Al Bakhit said the oil would come from the northern Iraqi refinery of Kirkuk and that it will be trucked overland across the desert into the kingdom by a joint Jordanian-Iraqi firm.

Iraq's September exports steady at 1.64m bpd

Iraq exported 1.64 million barrels per day of crude in September, unchanged from August, shipping sources said yesterday.

Iraq shipped most of the oil from the country's main southern export terminal in Basra.

It also sold a total of 1.6 million barrels that it pumped through the vulnerable northern pipeline to Turkey. The flow through the line has been on hold since September 3.

Kirkuk oil from Iraq's northern fields, in storage at the Turkish terminal of Ceyhan, stood at around 300,000 barrels, one shipper said.

- Reuters