U.N. appeals for $500 million in humanitarian aid for Iraq

By Adrian Croft BRUSSELS (Reuters) - The United Nations launched an appeal on Thursday for half a billion dollars in international aid to tackle a worsening humanitarian crisis in Iraq triggered by the conflict with Islamic State militants. Lise Grande, the U.N. humanitarian coordinator for Iraq, said the United Nations would be forced to slash or shut down more than half its aid operations in Iraq without an immediate injection of new funds. The world body said it was asking donors for $497 million to pay for shelter, food and water over the next six months for millions of Iraqis forced from their homes or otherwise affected by violence between Iraqi forces and Islamic State fighters. "In the months ahead the humanitarian situation is going to get worse ... By the end of 2015, 10 million Iraqis are likely to need some form of life-saving assistance," Grande said, launching the appeal at the European Parliament. Islamic State fighters swept through north Iraq last June as Iraq's army disintegrated. Their advance was contained by Shi'ite militias and Kurdish peshmerga fighters, backed by U.S.-led air strikes. Iraqi security forces and Shi'ite paramilitaries are preparing to launch a counter-offensive to retake the city of Ramadi, which fell to the militants in May. Violence has already forced nearly 3 million Iraqis from their homes, the U.N. says. Grande said more than 4.4 million Iraqis needed food as key agricultural areas, including large parts of Iraq's cereal belt, had fallen under Islamic State control. World Health Organisation Director-General Margaret Chan said public services for health, water, and sanitation, were collapsing. "Crowded, unsanitary conditions bring a high risk of infectious diseases, especially for the millions who have been internally displaced ... Cases of measles are now being reported from all 18 governorates. Cholera is endemic," she said. The speaker of Iraq's parliament, Salim al-Jabouri, said the Islamic State advance had put Iraqis' future under severe threat. A slump in crude prices and the loss of some oil fields to Islamic State has increased Iraq's need for international help. "The fact that we have all the oil in our country that we are unable to use ... means we can't help the internally displaced people who are victims of the terrible terrorism perpetrated by Daesh," Jabouri said, referring to Islamic State. The European Union's executive Commission announced an extra 25 million euros ($28.2 million) in humanitarian aid for Iraq, bringing its 2015 total to more than 63 million euros. In Geneva, medical charity Medecins Sans Frontieres called for U.N. and other aid agencies to "get out of their comfort zone" and reach tens of thousands of Iraqis who have fled fighting and are in desperate need of aid and health care in areas including north of Mosul, south of Kirkuk and the outskirts of Baghdad. ($1 = 0.8872 euros) (Additional reporting by Stephanie Ulmer-Nebehay and Isabel Coles; Editing by Dominic Evans)