Why Iran-Iraq war hasn't had greater worldwide impact

When the war broke out between Iraq and Iran in September 1980, many observers feared that it would eventually cause an oil crisis. In an even more ominous light, some were concerned that if it were prolonged, the war might draw the two superpowers - the United States and the Soviet Union - into a major confrontation in the region.

A staff report to the US Senate Committee on Foreign Relations, released here this week, helps to explain why the worst has not occurred. It says that at the moment there is ''no serious concern'' that the Iran-Iraq war will engage the superpowers in hostilities. And by implication at least, it indicates that the Reagan administration has handled the situation both cautiously and effectively.

Despite the current ''tanker war'' taking place in the Gulf, the staff report says that ''there is greater calm in most Gulf countries and in the international oil market than most observers had predicted.''

One of the most important conclusions contained in the report is that the Iran-Iraq military balance has shifted in Iraq's favor during the past year. This, it says, is a result of the worldwide arms embargo on Iran and ''massive arms sales'' to Iraq by the Soviet Union and France. It argues that at this point, an Iranian assault on Iraq would probably lead to a defeat for Iran unless Iraqi morale collapsed.

The 41-page study is the result of visits made to the Gulf region in July by two teams consisting of a total of five Foreign Relations Committee staff members. They were sent at the direction of Republican Sen. Charles Percy of Illinois, the committee's chairman, and Sen. Claiborne Pell of Rhode Island, the committee's ranking Democrat. The two teams combined their findings into what might be called a bipartisan report, although it does not necessarily represent the views of the committee's majority.

In releasing the staff report, however, Senator Percy in effect endorsed it. He said that ''current US energy, political, and security policies have helped calm the international oil market and reduced the fears of nations in the region.''

The report points out that this region contains half the world's proven oil reserves. The disruption of oil exports from the region in 1973 and again in 1979 (the so-called oil shocks) had a profound effect on the world economy. During the past seven months, an expansion of the Iran-Iraq war into the Gulf itself, with attacks by both sides on tankers, has threatened a third interruption of the oil supply.

On Monday, a rocket, probably fired by an Iranian jet, hit a Panamanian tanker. The tanker's captain radioed that he was heading to the port of Dubai for repairs.

The tanker, identified as the 20,880-ton Cleo 1, was reported by the Associated Press to be bound from Colombo, Sri Lanka, to pick up crude at Saudi Arabia's oil terminal of Ras Tanura. The ship was deep inside the Gulf at a point about 60 miles northeast of the northern tip of Qatar when it came under attack, according to shipping sources.

At least 40 ships passing through the Gulf have been hit since February. Eight of them are believed to have been attacked by Iran, and the rest by Iraq.

But the Foreign Relations Committee staff report notes that this tanker war is having ''remarkably little effect on Persian Gulf exports.''

According to the report, there are several reasons for this. In general, the tankers do not sink when hit, but make it to port for repairs. The crude on board is usually saved. Crews are highly paid. Higher insurance premiums have been compensated for by the producers in several ways: Iran has lowered the price of its crude. Kuwait makes some deliveries of its own outside the Gulf and guarantees replacement of any crude lost to attack, so that only the tankers need insurance. The Saudis protect shipping in their area by providing air cover.

In addition, some of the tankers have found a way of evading attack. They make their runs from the relatively safe waters near Dhahran, Saudi Arabia, to the Strait of Hormuz at the entrance of the Gulf at night when Iran's F-4 jets are not capable of attacking.

The relatively low cost of oil production in the Gulf states has permitted those nations to absorb the additional costs brought by the tanker war. And a surplus of tankers has encouraged importers to take risks.

Meanwhile, the pressure among Gulf producers is for more production, not less.

A sense of confidence in the region that the oil supply system can stand continued stress appears to derive from a number of additional factors, including:

* A sizable American naval presence just outside the Gulf.

* An enhanced Saudi Arabian defense capability.

* The Saudis' floating 50 million-to 70 million-barrel oil storage in the Red Sea.

* The existence of the US Strategic Petroleum Reserve (SPR).

The US Department of Energy testified in March that in the event of a disruption of oil supplies, the combination of SPR and American commercial inventories would provide a large cushion, amounting to 120 days' worth of 1983 -level imports.

The Foreign Relations Committee staff report emphasizes that in its authors' view, the much-debated US decision to sell Saudi Arabia advanced weapons has played an important role in stabilizing the situation and avoiding a need to get US forces more directly involved in defending the Saudis.

''Sources in the area say that without the capabilities provided to the Saudis by US arms sales, the Saudis might well now be seeking the direct support of US Air Force fighter aircraft to defend their oil fields.''

The report says the US has ''tilted'' toward Iraq in the Iran-Iraq war in an effort to maintain a balance of power. In the US view, a victory in the war by either Iran or Iraq could threaten Gulf nations allied with the United States.

Since 1982, when the Iraqis agreed to negotiate a peace agreement without conditions, the US has taken a number of steps to shore up Iraq, including what the report describes as ''vigorous support'' for an arms embargo against Iran.

''The United States has been particularly active and effective in persuading West European allies and Israel not to sell to Iran,'' the report says.

of stories this month > Get unlimited stories
You've read  of  free articles. Subscribe to continue.

Unlimited digital access $11/month.

Get unlimited Monitor journalism.