US embassy cable - 05KUWAIT2464

C O N F I D E N T I A L KUWAIT 002464 
 
SIPDIS 
 
E.O. 12958: DECL: 06/05/2015 
TAGS: MOPS, EPET, PREL, EAID, MARR, PGOV, IZ, KU 
SUBJECT: KUWAITI PAPER REPORTS DEAL ON OIF JET FUEL 
 
Classified By: Ambassador Richard LeBaron, Reasons 1.4(a) and (d) 
 
1.  (U) On June 5, local Arabic daily newspaper Al-Qabas ran 
a short, front-page piece saying that Kuwait has agreed to 
supply the U.S. with reduced-price jet fuel for operations in 
Iraq (full text in para 2).  Under the terms of the deal, the 
story said, Kuwait would provide jet fuel for $24/ton rather 
than $70/ton, reducing the U.S.'s total jet fuel bill to $600 
million (from $1.75 billion). (Note.  The actual arrangement 
is denominated in barrels, not tons.  End Note.) 
 
2.  (U)  BEGIN TEXT OF ARTICLE. 
 
Al-Qabas, June 5, 2005. 
 
Al-Qabas has learned that a proposed settlement between 
Kuwait and the U.S. was concluded to reduce the price of 
fighter jet fuel from $70 to $24/ton (sic).  The sources 
confirmed that the amount due will be $600 million instead of 
$1.75 billion.  It is well known that Kuwait supplies the 
U.S. army with fuel in general, and with jet fuel in 
particular during Iraq operations.  END TEXT. 
 
3.  (C)  COMMENT.  This is the first public reference to 
discounted fuel for OIF operations that we have seen.  The 
topic may have come up as part of recent budget proceedings 
in the National Assembly.  Several times over the last few 
weeks, GOK officials have expressed to us privately their 
relief that this issue has been "resolved" successfully. 
They are unaware of continuing deliberations in Washington 
about what constitutes fuel for OIF versus fuel used under 
the Kuwait DCA.  The article cited above confirms that the 
GOK is keeping track of fuel used for OIF, in anticipation of 
finalizing a contract. 
 
4.  (U) Baghdad minimize considered. 
LEBARON