Text size

Fuel company Sonol is supplying refined fuel to U.S. forces in Iraq as part of a $70 million contract, an industry source said yesterday. The deal is the first known commercial link between Israel and post-Saddam Hussein Iraq.

Sonol, one of the country's largest oil companies, and Morgantown International of the United States, were awarded the fuel supply contract by Halliburton, an American company involved in Iraqi reconstruction efforts, the industry source said, speaking on condition of anonymity.

The source did not know the origin of the oil used in the refined fuel, but it is apparently imported via Ashkelon and then pumped through to Be'er Sheva, where it is loaded on tanker trucks and moved down to Eilat. From there, the fuel in transfered to Jordanian tanker trucks at the Aqaba border crossing and moved to Iraq via Jordan. The source said Sonol began supplying the fuel several weeks ago.

Iraq has the second largest oil resources in the world, but U.S. forces there have had to import refined fuel because saboteurs and poor maintenance have limited domestic refinery capacity.

Until recently, the U.S. forces in Iraq received all their fuel from Kuwait. However after Halliburton, U.S. vice president Dick Cheney's former firm, admitted to overcharging the military, a tender was issued to find other suppliers.