Sweet & Sour: War may be over, but Iraqis battle for survival

Just past the U.S. tank at the gate to Baghdad's Daura refinery, the small sign in Arabic proclaims "Arab oil for the Arabs". Inside, Dathar Al Khashab, refinery director, sits in his office in blue overalls poring over a pile of papers, trying to figure out how to cope with a severe shortage of gasoline that is pushing the devastated city of Baghdad further down the road to chaos since U.S. forces "liberated Iraq".

You don't have to drive too far from the refinery on the outskirts of Baghdad to realise the magnitude of the problem faced by Iraq's oil managers as they try to lift a potential oil goliath to its feet.

Nearly two months since the end of the U.S.-led war that deposed Saddam Hussain, Iraqis have no recognisable government and no single authority that appears to be in charge. The war may be over but life for the average Iraqi is a daily battle for survival as he struggles to secure petrol for his car, running water for his home and security for his children. Iraqis blame the Amer-icans and the Americans insist it is up to the Iraqis to get their act together and restore order to the country, the democratic way of course.

Yes, Iraq's oil belongs to Iraq but who is in charge of the decision-making process? Who decides whether Iraq, a founding member of Opec, stays within the producer group. Who decides whether and, more importantly, which foreign oil companies will get production sharing contracts to develop Iraq's untapped oil and gas reserves?

"I wear the trousers here," says Thamer Ghadban, the suave de facto oil minister who still turns up for work each day in a suit and tie.

But his is far from a routine day at the office. His air conditioning unit was stolen just days ago despite the U.S. troops guarding the entrance to the giant concrete structure where barbed wire fences have now been erected. The custodian of what is potentially the world's biggest oil reserves does not have a working telephone, no computer and no reliable power supply.

Even more difficult is the balancing act Ghadban has had to play, trying to satisfy the demands of the U.S.-appointed oil advisory committee and an angry populace that is threatening to revolt.

But Ghadban is taking it one day at a time. His top priority is the restoration of a reliable supply of gasoline and cooking gas, the first step towards normality in a country where anger is building up daily in the face of the chaos that has reigned since Saddam was ousted.

The crime rate has soared since Saddam's iron grip was amputated by the U.S. army while basic public services are virtually non-existent. The Americans may claim to have "liberated" Iraqis but the price of freedom has been chaos as criminals roam the streets at will, robbing cars at gunpoint and, if the newly printed newspapers are to be believed, snatching young girls to sell in the white slave trade that is a new phenomenon in Iraq where fear of Saddam's police made for a very low crime rate.

The U.S. Office for Recon-struction and Humanitarian Assistance, the inaccessible interim administration, is relying on the oil industry to help end the mayhem and restore order by generating funds to help rebuild the nation.

But the U.S.-led war that effectively ended when U.S. troops marched into Baghdad on April 9, was the final straw for the Iraqi industry. Oil installations and equipment that survived two wars since 1980, 12 years of UN sanctions and the latest U.S. bombing have been cannibalised by looters and robbers.

The trickle of gasoline making its way to the petrol pump somehow finds its way into jerry cans that profiteers sell for 10 times the going price in active kerbside trade.

A litre of gasoline that sold for 50 Iraqi dinars before the war now fetches 500 dinars and not many Iraqis, most of whom had not been paid salaries for over two months, can afford the price. One can currently get 1,000 Iraqi dinars for $1 at one of the several exchange booths that line streets littered with rubbish and war rubble.

The alternative is a wait of up to half a day at crowded petrol stations, where Baghdadis pushing their cars in long queues to fill up their tanks add to the general traffic mayhem.

Iraq is now producing 700,000 barrels per day of crude oil, enough to satisfy local demand under normal circumstances. But the refineries are drowning in fuel oil because there have been no exports since the war began and power stations are operating below capacity.

The crude oil being produced is feeding the country's three refineries while the rest is being re-injected into the reservoirs, a practice that is potentially damaging to oil structures. Yet the volume of crude oil is needed in order to extract associated gas to produce liquefied petroleum gas used here for cooking.

Now that the United Nations' oil-for-food programme has been scrapped by a Security Council resolution, Iraq is once again preparing to return to the oil market to sell its oil freely for the first time in 12 years. The resumption of exports, now expected within the next two weeks, will help to alleviate some of the immediate problems and shortages.

But even though Ghadban insists he wears the trousers and Khashab his overalls, it is hard to escape the fact that it is American tanks guarding their offices and American advisers sitting in the presidential palace.