Just over 34 million barrels were exported in December, with northern pipelines sabotaged and tanker drivers grounded by death threats in areas hit by the Sunni insurgency. The shortage has plunged much of Baghdad into darkness for hours and left mile-long queues outside petrol stations. There is concern that rising public frustration will increase instability.

Iraqi and US officials play down the problems, confirming that Iraq’s largest refinery, Beiji, resumed supplies on Sunday after a ten-day closure, with soldiers guarding tankers.

But the winter crisis was aggravated when Ibrahim Bahr al-Uloum, the Oil Minister, confirmed his resignation over the Government’s fivefold rise in petrol prices. Complaining that it had not protected poorer Iraqis, he called Ibrahim Jaafari, the Prime Minister, a "dictator" for putting him on an enforced one-month holiday after earlier criticism.

The shortages led to a riot in Kirkuk, where police shot dead four people on Sunday, and the burning of petrol stations.

"Politicians are always saying that they are in support of Iraqi citizens and now they are increasing the price of petrol," said Muhammad Ali, 40, amid petrol queues and blackouts in Baghdad. "We were oppressed for 35 years. We are like a sick patient who is in need of care, and they are increasing prices."

Under Saddam Hussein’s regime, Iraqis were accustomed to some of the cheapest petrol in the world. But more rises are likely, with the Government slashing subsidies as part of an International Monetary Fund deal to write off 80 per cent of Iraq’s debt.

Western officials say that the Government fails even to cover the cost of extracting oil because of its $5 billion annual subsidies on petrol products.

Stung by criticism of difficulties in the country with the world’s second-largest oil reserves, the Government attempted damage limitation, pointing out that before the increase, petrol cost 28p a litre to import, but sold for 2p.

The problem highlights the Sunni-led insurgency’s success at striking Iraq’s oil and electricity infrastructure.

Brigadier-General William McCoy, commander of the US Army Corps of Engineers in Iraq, described sabotage as the biggest obstacle for his reconstruction teams: 91 reconstruction contractors had been killed since June 2004, and last week was the worst, with six killed — two in accidents four wounded and two kidnapped.

Nevertheless he called it a blip against a downward trend: "We are determined to see this through — the coalition and the Iraqis deserve that. And we are going to be successful."

Iraqis remain furious at the lack of apparent progress. Nearly three years after the war, Baghdad’s Doura power station is a visible symbol of discontent, only one of its four chimneys belching smoke each day.

Although General McCoy says he is on target to have 6,000 megawatts on the grid in 2006, the present figure of 4,800MW is little improved on the pre-war 4,000MW.

Citing sabotage, crumbling infrastructure and decades of poor maintenance, General McCoy told The Times that the US-led coalition probably could have solved the problems "in an environment that was very permissive, but we haven’t had that opportunity".

The general added: "The electricity problem here is about a $20 billion programme. We are putting about $4 billion into the electrical system. Given that the problem is roughly five times the amount of money we have available, we are moving towards our goal of ten-twelve hours of power a day."