Iraqi Mig war planes bombed Iran's main oil terminal on Kharg Island in the Persian Gulf yesterday, and both sides agreed that after three days of fighting Iraqi forces have captured a number of Iranian border towns along a 350-mile-long front where the ground war is now concentrated.
Jet fighters from each country again attacked military and oil installations of the other in wide-ranging raids. Fires at two crude oil storage tanks on Kharg, 125 miles southeast of the disputed Shatt-al-Arab estuary, were reported under control, although oil shipments were temporarily suspended.
In fact, all shipping of oil by sea from the two countries has virtually ceased, affecting about 3 million barrels of daily oil production. Elsewhere in the gulf, however, oil continued to flow toward the West and Japan.
Iraq claimed by the end of the day to have taken four Iranian border towns, pushed at one point as deep as 20 miles into Iran and occupied a 10-mile-wide strip stretching from Qasr-e-Shirin in the north to Abadan in the south. Iran admitted "a few" border points had fallen but denied Iraqi claims that either Qasr-e-Shirin or Mehran, in the central sector of the war front, had been taken.
[At least four Iranian Phantom jets rocketed the Iraqi capital just after dawn Thursday, an Agence France-Presse correspondent reported by telephone from Baghdad. In Tehran, the official radio reported that three Iraqi Migs were shot down near Bushehr on Wednesday.]
In a new twist to the assault on oil installations by both countries' armed forces, Iranian warships were reported to have bombarded Iraqi oil terminals off al Fao island at the tip of the Shatt-al-Arab.
There were no indications that either side is ready to take heed of a United Nations Security Council appeal issued Tuesday night calling upon both Iran and Iraq "to desist from all armed activity" as a first step toward a resolution of the crisis.
Iranian President Abol Hassan Bani-Sadr said Iranian forces would fight to "the last drop of blood" to repel the invading Iraqis, and one of his top aides was quoted by the French news agency as saying there was no question of a cease-fire.
The first Arab attempt to mediate the dispute got under way yesterday as the leader of the Palestine Liberation Organization, Yasser Arafat, flew to Baghdad. He is scheduled to go on to Tehran for talks with Iranian leaders.
As the war entered its third day, there were reports from both Baghdad and Tehran of long lines at stores, shops and gas stations in anticipation of shortages as the fighting drags on.
Altogether, it appeared the Iraqi ground thrust into Iran had made some progress but that Iranian troops were still putting up a strong defense, even in the reportedly surrounded towns of Abadan and nearby Khorramshahr in the Shatt-al-Arab.
The main question overshadowing the escalating hostilities was just how long both sides could continue fighting at the present level.
U.S. military experts said there were no signs yet that Moscow was sending new supplies to Iraq, 70 percent of whose military arms are Soviet in origin. While blaming the United States for the war, the Soviet media carefully avoided taking sides in the dispute.
While Iraq has so far committed three divisions to the disputed areas and moved another three toward the front, U.S. military specialists still insisted yesterday that there were no signs so far that the Iraqis are mounting a full-scale assault on Iran.
The same specialists also said that actual war damage was less than would seem to have been indicated by the claims and counter-claims of the two sides.
U.S. adminstration officials said privately there was still no clear pattern to Iraqi troop movements to indicate what Baghdad's ultimate objectives in the war may be. The principal concern throughout the administration appeared to be general volatility and unpredictability of both governments in the current crisis.
There were indications that the recapture of three small islands near the strategic Hormuz Strait, taken over from two Arab emirates by Iranian forces in 1971, might be among Iraqi objectives. Iraqi Defense Minister Adnan Khairallah told a press conference in Baghdad that "they are Arab islands. They are in Arab waters. It's quite clear who they belong to."
In addition, Iraqi diplomats have been telling various foreign governments that the return of the islands -- Abu Musa and the Greater and Lesser Tumbs -- are among three key conditions for the end to the fighting. The other two were reported as Iranian recognition of Iraqi sovereignty over the vital Shatt-al-Arab waterway and over other disputed border areas.
But the Iraqi government has yet to make an official statement on its conditions for peace, or to make clear whether it is laying claim to the three islands or asking that they be returned to the United Arab Emirates.
As his news conference, Khairallah said, "We do not have any covetous intentions on Iranian oil or Iranian territory." But he vowed that Iraq would press its offensive "until Iran responds to our legitmate demands."
In yesterday's fighting, Iraq claimed to have "routed" Iranian troops in the central sector of the 350-mile front, shot down or destroyed on the ground another 25 Iranian American-made jets and nine naval vessels, including two frigates, and to have pushed, at the farthest point, 10 to 20 miles into Iran. fIraq now claims to have knocked out a total of 92 Iranian fighter jets.
It also said its forces had taken four border towns -- Qasr-e-Shirin, Mehran, Sinien and el Zaidi -- and pushed up to 20 miles down the highway beyond Qasr-e-Shirin to the village of Sar-e-Pol-e-Zahab.
The Iraqis said more than 350 Iranian troops surrendered in the battle for Sar-e-Pol e-Zahab and that Iranian forces were "fleeing, abandoning tanks" and other equipment as the Iraqi troops advanced.
Waves of Iraqi Migs also carried out nine new raids on seven different targets, mostly airbases, the military high command announced. But Tehran radio reported that the Migs also hit a number of oil installations, including the terminal at Kharg and a sprawling $3.5 billion petrochemical complex being built by the Japanese at the gulf port city of Bandar Khomeini, 60 miles east of Abadan. Damage at both installations was reported to be minor.
The Iraqi high military command said it had issued an ultimatum to Iranian troops in Abadan and several other allegedly surrounded towns to surrender by night fall or accept the consequences of an assault on them.
Reports from Tehran said fighting was particularly intense along the disputed Shatt-al-Arab waterway yesterday but that the key Iranian towns of Abadan and Khorramshahr held out against heavy Iraqi Army pressure.
Reuter news agency quoted residents of the latter city as reporting Iranian air attacks had held off the Iraqi advancing column north of the town in the district of Shalamche. But shooting continued inside the city of Abadan, where the world's largest oil refinery, first set afire by Iraqi jet attacks Tuesday, suffered fresh damage yesterday. The installation had already been shut down.
While Iranian troops were reported to be holding on in these two key cities, there were indications from Iranian officials themselves that all was not going well further to the north. In an interview with Tehran radio, Iranian acting Chief of Staff Valiollah Fallahi admitted that it was "possible that in the short term the Iraqi Army might achieve superficial, local and short-lived sucesses." He added, however, that "in the long term we will ultimately prevail."
He also said Iran had "certain short-comings" in the field of maintenance and repair of its largely American-provided military equipment.
But Iran is apparently not suffering from a shortage of troops in the war as Fallahi appealed to the Iranian civilian population not to try to join the armed forces as volunteers at this point.
Meanwhile, Iran's revolutionary leader, Ayatollah Ruholla Khomeini, made a dramatic appeal to Iraqi's minority Shiites "to join the Iranian people and other Moslems of the world to defend Islam and send infidels and traitors to hell . . . This war led by the Iraq Baathist regime against Iran is a war contrary to the principles of Islam, the Koran and justice," Khomeini said.
Both sides have given the war a religious tinge by appealing to the other's nationals to help overthrow their government. While Shiites form the majority of the Iranian population, Sunni Moslems provide the core support of President Saddam Hussein's regime in Iraq.
For the first time, Iran yesterday published casualties from Iraqi bombings Monday and Tuesday, saying that 140 Iranian civilians were killed and over 300 wounded. Iraqi figures for casualties inflicted by the Iranian bombings for the same two days were 47 killed and 116 wounded.
The Indian embassy in Baghdad yesterday reported that 10 Indian citizens were killed in the Iranian raids in and around Basra Tuesday and yesterday. In addition, four Britons have been confirmed killed and there are uncomfirmed reports that four other Americans were killed in the same attacks. u
An Iranian report yesterday also said four other Americans were captured by Iranian forces fighting Iraqi troops near Shalamshah.
News agencies reported long lines were forming in Tehran for gasoline, food and other essentials as the reality of the war came home to residents. Until the bombing of the city's international airport by Iraqi Migs on Monday, killing two persons and wounded several others, the war had seemed a distant happening.The airport has remained closed to civilian traffic ever since.
Iranians were mostly staying at home glued to their radios to catch news of the war from communiques issued periodically throughout the day from the joint command of the armed forces. The communiques were interspersed with martial and revolutionary music.
Baghdad reported by Westerners living there to be very quiet yesterday with no new Iranian attacks on the Iraqi capital following five or more raids Tuesday. Iraqi television continued to show martial programs during the day, and as in Tehran, most Iraqis were listening for news of the war.
Western residents reported seeing only scattered damage in and around Baghdad as a result of the Iranian air attacks but frequent military check-points throughout the city made an accurate assessment difficult. In one quarter, four houses were destroyed, apparently by bombs, while other damage was attributed to falling airplanes.