Friday, March 18, 2005

Kuwait, US in Oil Dispute

KUWAIT CITY (AFP): The United States and its staunch ally Kuwait are locked in a dispute over Washington’s failure to pay hundreds of millions of dollars for fuel supplies for its army, a parliamentary source said Wednesday.

Kuwait is asking the United States to pay some $500 million for fuel it supplied to the US army after the US-led war on Iraq two years ago but Washington has said it would pay less than one-third of the amount, the source told AFP on condition of anonymity.

The London-based pan-Arab newspaper Al-Hayat said Wednesday that the dispute was disclosed a few days ago by Islamist MP Nasser al-Sane during a meeting with his voters. Sane said that before and during the Iraq war, Kuwait supplied the US army with fuel worth $450 million free of charge, its contribution to the overthrow of the regime of Saddam Hussein.

Supplies continued after the war and the country recently demanded payment of $500 million after calculating the amount at a preferential price of $21 a barrel, Sane was quoted as saying.

US Defense Secretary Donald Rumsfeld responded with a tough-worded letter saying that Washington had liberated the country from Iraqi occupation in 1991 and because it enjoys a fiscal surplus, there was no need to demand the payment.

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