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House pans Iraq oil reconstruction
WASHINGTON, July 18 (UPI) -- A U.S. House hearing on Iraq's oil sector panned Iraqi efforts and took aim at U.S. pressure on Baghdad to pass an oil law.

The joint hearing between two subcommittees of the House Committee on Foreign Relations also heard from a top-level Government Accountability Office official who raised serious flags.

Joseph Christoff, director of GAO's International Affairs and Trade Division, warned production numbers provided by the State Department may be inflated, there's inadequate metering and reporting of oil production and the security situation keeps getting worse.

That, plus the endemic levels of corruption, smuggling and theft, as well as Iraq's inability to spend its capital investment budget, makes passing a law governing the oil resources even harder.

"It first begins with a secure and stable environment," Christoff said. "That's difficult to achieve when you reached nearly an all-time high in attacks."

"This seems to be a total screw up," said Rep. Gary Ackerman, D-N.Y., chairman of the Middle East and South Asia Subcommittee.

"A lot of problems," Christoff replied.

"Ever seen anything like this?" Ackerman asked.

"Not in the 25 years I've worked for GAO."

Ackerman and other members, though pointing fingers at U.S. officials in Iraq, leveled consternation at Iraqi officials as well for their inability to function as a government, despite the civil war.

Christoff pointed to a lone bright spot, though: Iraq has continued decreasing its fuel subsidies, a requirement of international debt and loan guarantees. The move is seen as staving the fuel smuggling problem, though a big pain for Iraqis suffering from more than 60 percent unemployment.

Iraq averaged producing more than 2 million barrels per day last year, selling more than a quarter of it on the world market, which funded nearly all its federal budget. Iraq produced 2.6 million bpd before the war.

But it struggles to approve an oil law, which the Bush administration has pressed them on and Congress required as a benchmark in May's war funding bill.

"We're pressing the Iraqi government to pass a hydrocarbon law in a vacuum," said Rep. Bill Delahunt, D-Mass., chairman of the International Organizations, Human Rights and Oversight Subcommittee.


Ben Lando, UPI Energy Correspondent

House pans Iraq oil reconstruction -  Source

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