Russia Chases Baghdad Oil Bonanza. (Oil & Gas)

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Investment in the oil sector will be at the heart of the $40,000 million economic cooperation deal that Russia and Iraq are expected to sign by the end of August. The deal, disclosed by Baghdad's representative in Moscow Abbas Khalaf on 16 August, is designed to consolidate relations between the two traditional allies. However, the agreement is likely to be viewed by the US as a further obstacle to Washington's plans to launch a military attack on Iraq.

The five-year co-operation programme is expected to cover a variety of sectors, foremost among which will be Iraq's battered oil industry. Other fields of interest to Russian companies include power, chemical production and …