Pipeline as "a serious blow to Turkish-Israeli relations."

After the end of the British mandate, the 1948 war and the creation of Israel, Iraq stopped the flow of oil to Haifa and the pipeline, only 8 inches in diameter, fell into disrepair since then.

A recent research by the Israeli National Infrastructure Ministry put the construction of a 42-inch diameter pipeline between Kirkuk and Haifa at some 400,000 dollars per kilometer.

On Sunday, August 24, Israeli National Infrastructure Minister Yosef Paritzky vowed to discuss the issue with the U.S. secretary of energy during his envisaged visit to Washington next month.

He asserted that the whole project depends on Jordan’s consent, adding that the kingdom would receive a transit fee for allowing the oil to flow through its territory.

Paritzky believes restarting the pipeline could reduce Israel’s fuel costs by 25 percent and turn Haifa into "the Rotterdam of the Middle East."

Israeli Premier Ariel Sharon’s government "views the pipeline to Haifa as a ‘bonus’ the U.S. could give to Israel in return for its unequivocal support for the American-led campaign in Iraq," according to Haaretz.

Angry Turkey
At present, Iraqi oil is being shipped via Turkey to a small Mediterranean port near the Syrian border.

Ankara, which considers the transit fee it collects an important source of revenue, has warned Israel it would regard the talked-about Kirkuk-Mosul-Haifa pipeline as "a serious blow to Turkish-Israeli relations."

Haaretz quoted sources as saying reports about the alternative pipeline are part of an American "attempt to apply pressure on Turkey" which had opposed the U.S.-led invasion of Iraq and is still reluctant to commit troops to the neighboring country to ease the burden on American forces.

Iraq is one of the world’s largest oil producers, with the potential of reaching about 2.5 million barrels a day.

Oil exports were halted after the 1991 Gulf War and then were allowed again on a limited basis (1.5 million barrels per day) under the U.N. supervision through the so-called oil-for-food program.