The U.N. Security Council faces an odd convergence of problems over Iraq next week. It is near approval of expanding an ‘oil-for-food’ deal with Baghdad even as the United States is lobbying for using force to end the standoff over weapons inspections in Iraq.

Council sources say there is broad support for a draft resolution, sponsored by Britain, Portugal and Sweden, which would expand the exemption Baghdad currently enjoys from the seven-year U.N. embargo that allows it to sell oil worth two billion dollars every six months to buy humanitarian goods.

Under the terms of the draft resolution, Iraq would be able to sell oil worth up to 5.25 billion dollars in a period of 180 days. This would be used to pay for increased imports of food and medicine and for the rebuilding of the country’s infrastructure, which has deteriorated under the embargo.

The draft also would allow Iraq to spend an amount of money, which has yet to be determined, “to finance the travel by Iraqi pilgrims to perform the Hajj (Islamic journey to Mecca), on flights approved for these purposes.” The difficulties Iraqi Muslims have had in making the pilgrimage has been a contentious issue among many Middle Eastern countries, whose support for U.N. sanctions has waned in recent years.

The Security Council response comes days after U.N. Secretary- General Kofi Annan warned that the current oil-for-food deal is insufficient to handle the humanitarian needs of Iraq’s population – particularly of 1.9 million vulnerable women, children and displaced persons.

For the first time, said one senior U.N. official, who spoke on condition of anonymity, all the members of the Security Council believe that Iraq needs additional aid to rebuild its roads, electrical networks and sanitation before those systems collapse.

“This is a case which is recognised by all members of the Security Council, irrespective of which side they are on,” he said.

Nevertheless, deep divisions remain in the Council at a time when U.S. diplomats have been campaigning for the body to support Washington for a possible attack on Iraqi installations if Baghdad does not open its presidential buildings to U.N. weapons inspectors. As one U.N. diplomat noted, the Council next week may be in the position both to approve measures to improve Iraqi infrastructure and to consider language that would authorise a U.S. attack on other Iraqi installations.

While all Council members – including the United States – have viewed the expanded oil-for-food plan favourably, Russia and China remain opposed to the use of force in the Iraq standoff. Russian President Boris Yeltsin, who this week threatened that a U.S. attack on Iraq could provoke a “world war,” may use Moscow’s veto power in the Council to block any authorisation of force.

Russia’s U.N. Ambassador Sergey Lavrov disputed any grounds to find Iraq “in material breach” of the resolutions which established a cease-fire following the 1991 Persian Gulf War, in which US-led forces drove Iraqi troops out of Kuwait.

The United States has pushed for the Council to deem the blocking of the weapons inspectors as a material breach – which could justify the use of force – but Lavrov countered that such language could only be applied if Iraq invaded Kuwait anew.

Other countries have also been reluctant to allow a fresh attack on Iraq, but have wavered in their opposition. French Foreign Minister Hubert Vedrine said Paris “is trying to obtain a solution through diplomatic means,” and would not join any military action, but French diplomats here say they could support a new resolution criticising the blocking of the inspectors as a breach.

U.S. Ambassador Bill Richardson, who over the past week has travelled to nine of the capitals of the 14 other Council member states, said that the response to U.S. policy in Iraq has been encouraging, but added that Washington believes it can strike Baghdad alone if necessary.

“It is the United States’ view that existing Security Council resolutions give the right to the United States to pursue the military option,” Richardson said this week. “There’s already enough of a legal basis for the United States … We want to resolve this issue peacefully, but (Iraqi President) Saddam Hussein is leaving no choice to the international community.”

Russia contends that the United States does not have any pre- existing authority to strike at Baghdad – although U.S. forces have conducted limited air strikes at Iraqi targets in 1993 and 1995, citing the language of the Gulf War resolutions.

U.N. officials have tried to stay out of any dispute on whether Washington has the requisite authority, but Annan this week cautioned, “I think everybody would agree it would be preferable to get a Council authorisation before there is any military action.”

Some diplomats suggest that the United States likely will have to show its positive intentions towards Iraq by expanding the oil- for-food deal before any serious discussion can begin on any authorisation for an attack. But Richardson argued that Washington supports the expansion of the oil-for-food programme “because it’s humanitarian and it was started by the United States.”