Pipeline blast cuts Iraq's southern oil exports

By Ahmed Rasheed

BAGHDAD (Reuters) - Saboteurs blew up one of Iraq's two main oil export pipelines in southern Iraq on Thursday, cutting about half a million barrels a day of oil exports, a Southern Oil Company official told Reuters.

The attack came on the third day of an Iraqi military operation against fighters loyal to Shi'ite cleric Moqtada al- Sadr in the oil port of Basra. The pipeline was attacked 7 km south of Basra. There was no immediate claim of responsibility.

U.S. crude was trading up more than $1 at close to $107 a barrel after news of the attack.

"This morning saboteurs blew up the pipeline transporting crude from Zubair 1 by placing bombs beneath it. The pipeline was severely damaged," the official said, speaking on condition of anonymity.

"Crude exports will be greatly affected because this is one of two main pipelines transporting crude to the southern terminals. We will lose about a third of crude exported through Basra," he said.

Iraq exported 1.54 million barrels per day (bpd) from its main Basra oil terminal in February. A fire raged at the site of the blast on the smallest of the two pipelines, the official said.

"Firefighters are struggling to control the fire, which is huge. A lot of crude has spilt onto the ground. The main pumping station of Zubair 1 was shut down. We will not be able to repair it unless security is provided for the crews," the official said.

Fighting in the area would make controlling the fire difficult, he added.