(Updates with oil prices in 10th paragraph. For more on Iraq, see EXTRA <GO>)
Aug. 18 (Bloomberg) -- Kurdish forces took control of most of Iraq’s largest dam as the largest U.S. deployment of air power in the campaign helped reverse some of the gains made by Islamic State militants in the north.
The U.S. widened its airstrikes over the weekend and used bombers for the first time since the offensive began on Aug. 8 to help secure the dam near Mosul, Iraq’s largest northern city, that had been seized by the insurgents.
President Barack Obama for the first time authorized strikes for the purpose of protecting critical infrastructure, not just U.S. personnel or threatened Iraqi minorities. He told Congress in a letter the action is consistent with the mission to safeguard Americans and U.S. facilities.
Kurdish forces, also known as the peshmerga, will have full control of the Mosul Dam in “just a matter of time,” Fuad Hussein, the chief of staff for Kurdish Regional Government’s president Massoud Barzani, said in a phone interview yesterday. Kurdish forces were dismantling bombs placed near the main gates of the dam, he said. Nineveh provincial council member Hisham al-Brefkani also said the peshmerga controlled the dam except for “some pockets.”
The weekend action marked an escalation of U.S. involvement. Until then, the few dozen strikes over the past week had been limited to protecting U.S. personnel near Erbil, the Kurdish regional capital, and attacking militants around Mount Sinjar, where thousands of Yezidi civilians had been trapped seeking refuge.
While those strikes were aimed at stopping the advance of Islamic State forces, the weekend attacks near the Mosul dam marked the first effort at rolling back the militants’ gains.
In 14 strikes yesterday, the U.S. destroyed or damaged Islamic State armed vehicles, Humvees, armored personnel carriers and a checkpoint near the Mosul dam, by using a mix of fighter jets, bombers and armed drones, according to a statement from U.S. Central Command in Tampa, Florida.
Kurdish fighters, along with regular Iraqi forces and U.S. fighter jets, are seeking to rein in the Sunni insurgents known as the Islamic State who have rampaged through OPEC’s No. 2 oil producer, seizing border posts, beheading foes and targeting dams.
“There was no fierce fighting” involved in the push to control the dam, al-Brefkani said by phone.
Oil futures declined after Islamic State gains were reversed. Brent for October settlement slid as much as $1.18 to $102.35 a barrel on the London-based ICE Futures Europe exchange and was at $102.60 at 1:42 p.m. Singapore time. WTI for September delivery fell as much as 77 cents in electronic trading on the New York Mercantile Exchange.
The dam is the most important asset the Islamic State captured since taking Nineveh province in June. The militants also control several oil and gas fields in western Iraq and eastern Syria, generating millions of dollars in daily revenue to help fund the caliphate it announced and strengthen its grip on territory it has seized.
Although the Defense Department declined to name the aircraft involved in the latest strikes for operational reasons, the weekend offensive marked the largest deployment of U.S. aircraft in the 11-day-old campaign, according to a U.S. defense official who spoke on condition of anonymity.
“These air operations are for the sole purpose of helping the Iraqi military and Kurdish forces to defeat the militants around strategic sites,” Theodore Karasik, director of research at the Institute for Near East and Gulf Military Analysis in Dubai, said in a phone interview. “The U.S. must hit critical equipment and economic assets to weaken the Islamic State’s grip on territory.”
In authorizing the initial airstrikes on Aug. 7, Obama tied expanded U.S. action to the formation of a more inclusive government capable of easing sectarian and ethnic divisions.
That prospect was strengthened last week, when Prime Minister Nouri al-Maliki agreed to step aside after his backing at home and overseas had crumbled. Prime Minister-designate Haidar al-Abadi has until mid-September to form a less divisive government better able to fight the Sunni militants.
Even so, the Iraqi government expressed a new frustration with the U.S. yesterday by accusing it of conducting airstrikes without its approval and violating Iraq’s sovereignty.
“It was noticed in recent days that war jets have violated the skies of the country, arming local sides without our approval,” according to al-Iraqiya state television, which cited a statement issued by the chief of armed forces.
Obama, in a letter yesterday to House Speaker John Boehner, said the strikes near the Mosul dam “are being undertaken in coordination with the Iraqi government.”
The Pentagon’s top spokesman, Rear Admiral John Kirby, said last week that airstrikes could occur “anywhere in Iraq, including down in Baghdad.” Even so, he said at a briefing, “We’re not going to become Iraq’s air force.”
Obama said the strikes near Mosul were justified to help meet the objectives of the military mission: protecting U.S. personnel in Iraq and averting a humanitarian crisis.
“The failure of the Mosul Dam could threaten the lives of large numbers of civilians, endanger U.S. personnel and facilities, including the U.S. embassy in Baghdad, and prevent the Iraqi government from providing critical services to the Iraqi populace,” Obama said in the letter.
With the prospect of a new government in Baghdad taking shape, pressure is building on Obama to take greater action against Islamic State.
“We cannot just put our heads in the sand and pretend it doesn’t exist,” said Representative Eliot Engel of New York, the top Democrat on the House Foreign Affairs Committee. If Islamic State is allowed to get bigger, Engel said on “Fox News Sunday” yesterday, “they’re going to plot homeland attacks on us.”
European nations are also showing signs that they are willing to engage in northern Iraq. The U.K. will have to use its “military prowess” to help defeat an “exceptionally dangerous terrorist movement” in Iraq, Prime Minister David Cameron said in an article in the Sunday Telegraph. The German government would support an international mission in northern Iraq if authorized by the United Nations, Der Spiegel reported, citing unidentified people in the German government.
Iraqi shares surged yesterday the most since January 2012 on speculation that Maliki’s resignation will restore stability. ISX General Index jumped 7.1 percent to 101.16 at the close, according to data on the bourse’s website.
--With assistance from Khalid Al-Ansary in Baghdad.