Guerrillas deploy donkey carts to strike at occupiers

Thirteen days after the United States military launched a flamboyant operation to smash Iraq's guerrillas by using fighter jets, Apache attack helicopters and 500lb satellite-guided warheads, the resistance delivered their reply yesterday. They fired rockets into two prestigious Baghdad hotels and the Iraqi Oil Ministry from donkey-drawn carts.

Although crude and unsophisticated, the rockets achieved much of what their planners must have wished for. They won worldwide headlines and a place in the history of this deteriorating conflict as one of the more brazen acts of defiance by the pro-Saddam die-hards, anti-American nationalists, discharged soldiers and religious zealots who are thought largely to make up the Iraqi resistance.

The rocket attacks took place under the muzzle of American guns in the centre of the capital, a city that they are supposed to have brought under their control nearly seven months ago. Their targets included one of the most renowned and fortified landmarks, the Palestine hotel, an 18-storey monolith from which the world's television stations covered the invasion and fall of the capital. It continues to house Western contractors and the media, including ITN, Associated Press and CNN, and is used by Allied officials.

Only three of five armed donkey carts deployed in Baghdad yesterday fired their payloads. Two other donkey-hauled rocket launchers were later discovered.

One was close to the Italian embassy, which is still mourning the loss of 19 Italians in a suicide bombing in Nasiriyah earlier this month, and the Turkish embassy, whose diplomats are still digesting the security consequences of the latest bombings in Istanbul. It was laden with 21 rockets.

The other was near the city's Academy of Arts.

The purpose of the operation appears to have been, in part, to puncture claims by the American occupying forces, publicly made only a day earlier by the US commander in the capital, Brigadier General Martin Dempsey, of the 1st Armoured Division, that they are making headway in crushing resistance cells in Baghdad. Probably by chance, the assault also coincided with a conference on "Saddam's terrorists" at the Palestine. This was postponed.

Eight rockets, propelled from a street a few hundred yards away, blasted five holes in the façade of the Palestine hotel, hitting the 8th, 12th and 15th floors. Two people were hurt, one badly. "There was a tremendously loud explosion," said Timothy Mills, a writer for Dow Jones whose room was on the 15th floor and who was close to where rockets landed. "I thought there had been a car bomb outside. I hit the floor and waited for the next one."

The noise of the explosions triggered a rush to the scene from the photographers and cameramen among the hotel guests. This was not the first time such scenes have taken place: on 9 April, two cameramen were killed when an American tank fired on it.

One of the rockets fired towards the hotel yesterday hit the nearby Sheraton, which shares the same compound. Both have, for months, been ringed by razor wire, 12ft-high concrete blocks and military checkpoints. One of the missiles hit one of the Sheraton's external lift shafts, cutting the cables on one of the elevators, which crashed to the ground.

There were no injuries reported at the Oil Ministry complex, the nerve-centre of the country's crucial petro- chemicals industry and to American plans for the country's reconstruction. The building was largely unoccupied because it was a Friday, the Muslim sabbath.

The events were considered sufficiently serious to merit a rise in oil prices: Brent crude in London jumped 32 cents to $29.88 a barrel.

Colonel Peter Mansoor of the 1st Armoured Division said that the assault on the Palestine hotel bore a close resemblance to the attack on the Rashid hotel, which was pounded by rockets while the American deputy defence secretary, Paul Wolfowitz, one of the architects of the American and British occupation of Iraq, was inside.

* A Hungarian civilian working in Iraq was shot and killed at a military checkpoint by American soldiers. US troops shot Peter Varga-Balazs, 27, on Monday after he drove towards a checkpoint in Ramadi. His car then crashed into an American military Humvee, injuring several soldiers.