Shortly before Baghdad abruptly nationalized the Western-owned Iraq Petroleum Co. last month, Vice President Saddam Hussein Takriti, 35, flew off on a secret mission to Paris. No one knows whether Takriti, who is Iraq's boss as head of the dictatorial Baath (Renaissance) Party, actually told the French government of his plans to take over I.P.C. But he was sufficiently encouraged to return last week for a session with President Pompidou. After the meeting, Takriti announced a considerable diplomatic and commercial coup: the Compagnie Française des Petroles—one of six former corporate owners of I.P.C.—will take 23% of Iraq's oil over the next ten years. Italy's government-owned energy company, E.N.I., which had been reluctant to be first to do business with Baghdad, also signed a contract for at least another 20 million tons of oil.
The double agreement was a notable stroke for Iraq, which had been threatened with the specter of a Western boycott of its newly acquired oil, and loss of oil revenues that approach $1 billion annually. Even so, the government may still be in difficulty. The French could insist on taking oil as compensation for their investment in I.P.C., thus paying nothing for it; or they could offer payment in goods—chiefly heavy equipment—tagged with artificially high prices.
The arrangement leaves Iraq looking for customers for 60% of the oil it used to sell to the West. As the price for its derring-do in taking over I.P.C., Baghdad faces a severe cutback in its ambitious plans for agricultural and industrial development. The Baath regime has already ordered an austerity program to offset the drop in oil revenues. Foreign travel has been banned except for government officials, students or ailing citizens allowed to go abroad for treatment.
More ominously, the situation may strain an already uneasy truce between Baghdad and the dissident Kurds of the north, who claim ownership of the Kirkuk oilfield, which has been shut down ever since it was nationalized. "If there is to be a stoppage of national development, you can be sure the Kurds will be the first to feel it," said Dara Towfik, editor of the Baghdad-based Kurdish paper Al Ta'Khee, last week. Besides complaining that they have been shortchanged on development funds, Kurds feel that Baghdad has cheated on the terms of their truce. Kurd Leader Mustafa Barzani worked out an agreement with Baghdad two years ago that brought Kurds into Iraq's Cabinet. But in practice, they have been given hollow jobs. To top that off, eleven people were killed not long ago in an apparent assassination attempt against the Kurd leader. Tempers are high enough that any fresh controversy over the oilfields could lead to renewed demands for an autonomous Kurdistan.