SYRIA has expanded its oil-smuggling operation with Iraq by opening a second pipeline between the two countries, according to intelligence based on recent satellite photographs.

Iraqi crude oil is reported to be flowing at the rate of 60,000 barrels a day through the new pipeline, which connects two oilfields close to the Iraqi-Syrian border — Ain Zalah in northern Iraq and Suwaydiyah in northeast Syria.

Imports of Iraqi oil are illegal unless approved by the United Nations’ oil-for-food programme agreed after the 1991 Gulf War. The increase in oil imports from Iraq to Syria provides further evidence of closer ties between Damascus and Baghdad, after years of strained relations.

President Assad of Syria admitted last week that a pipeline, reopened in November 2000, had been used for sending oil from Iraq to Syria. But he insisted in an interview with The Times that the oil-flow had been agreed in order to test the pipeline, which had been closed for many years.

However, the flow of oil from Iraq to Syria through the two pipelines — amounting to an estimated total of more than 200,000 barrels a day — has enabled Damascus to increase its own oil exports by around 50 per cent.

Oil industry sources said that Syrian oil exports this year had suddenly risen from about 300,000 to 450,000 barrels a day. Syria has its own oilfields, which produce about 520,000 barrels a day.

The issue of illegal oil sales from Iraq to Syria is expected to be raised by Tony Blair when he meets the Syrian leader today, although a Foreign Office official said that Mr Assad was well aware of the Government’s disapproval of the pipeline deals.

The sales are helping to boost funds for the Iraqi regime as it prepares for a possible war with an American-led coalition next year. Sixty thousand barrels a day over a period of 12 months is estimated to be worth about $500 million (£330 million). Iraq has 112 billion barrels of proven oil reserves. Its oil resources are the world’s second-largest, after Saudi Arabia.

The main oil-smuggling route is through the pipeline that runs from Kirkuk in northern Iraq to Banias in Syria. This was reactivated two years ago, in spite of the UN sanctions. The 150,000 barrels of oil exported through the Kirkuk-Banias pipeline are sold at much less than the international price. The new pipeline began operating two months ago, according to Middle Eastern reports. It eventually feeds into the Syrian domestic pipeline grid. Oil industry sources said that Syria tended to use the Iraqi oil for domestic purposes. This freed Syria’s own crude oil for export. The 50 per cent rise in Syrian oil exports has occurred despite there being no significant increase in Syria’s own oil production.

Ian Brodie, from the journal Oil and Energy Trends, said that it was difficult to be precise about Syria’s oil exports. But it was clear that in the middle of this year there was a significant rise, due to Iraqi oil imports.

A report in The Sunday Telegraph yesterday said that crates of air defence equipment and spare parts had been smuggled into Iraq from Syria in the past few weeks. Defence experts were quoted as saying that the parts would help the Iraqis to improve the range and effectiveness of their Sam-6 anti-aircraft missiles.

Terrorism links

Although Syria has not been directly implicated in acts of terrorism since 1986, it supports terrorist groups such as Hamas, Hezbollah and Palestinian Islamic Jihad and allows them to maintain offices in Damascus.

The US State Department says that Damascus is the primary transit point for Iranian-supplied weapons to Hezbollah.

The Israelis claim that President Assad has met Sheikh Hassan Nasrallah, the leader of Hezbollah.

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