And he halted commerce between the United States and Iraq, a nation that normally provides the United States with 588,000 barrels of oil a day--7.6 percent of U.S. imports.
Administration officials said they could not estimate the value of Kuwaiti and Iraqi assets affected by the freeze, but one Treasury official described them as "significant."
After a morning of closed briefings, Sen. David Boren (D-Okla.), who chairs the Senate Intelligence Committee, said if Iraq headed for Saudi Arabia and its oil fields just 250 miles across the desert, "I think it would be a direct threat to the security of this country."
Saddam must calculate whether his nation, weary from its long war with Iran, is willing to support further miltary adventures, Boren said. A possible invasion by Iraq of Saudi Arabia "cannot be ruled out," he said.
And Sen. Lloyd Bentsen (D-Texas) expressed fear that if the Iraqi takeover of Kuwait succeeds "Saudi Arabia might be next--and then Saddam Hussein would have a stranglehold on the West's oil supply."
The Texan said the United States should seek a worldwide embargo against Iraqi oil. "Iraq is deeply in debt and very dependent on oil revenues and such an embargo would be an effective way to get their attention," he said.
Reflecting the anger boiling up on Capitol Hill, Rep. Ike Skelton (D-Mo.) told the House, "The attack is a financial assault on America and on the rest of the world that is dependent on Mideastern oil."
The House gave speedy 416-0 approval to a pending economic sanctions bill aimed at Iraq. The measure would cut off Iraq's $200 million a year in Export-Import Bank credits and tighten restrictions on U.S. exports that could have military as well as civilian uses.
Pentagon sources also said an evacuation of 3000 Americans, mostly business people, from Kuwait was under consideration. About 130 are U.S. employees.
The State Department said U.S. Embassy personnel were safe and the embassy grounds had not been penetrated during the fighting, but it advised Americans to postpone travel to Kuwait.
The aircraft carrier Independence and a six-ship battle group had been given high-speed authority to head toward the region from the Indian Ocean but were several days from reaching a "striking distance" position outside the Persian Gulf, Pentagon sources said.