Saboteurs have again targeted Iraq's oil industry, the lifeblood of the country's economy. A senior Iraqi oil official has confirmed that a sabotage attack against one of two southern export pipelines has reduced Iraqi oil output but not halted it. He told Reuters on Tuesday that the attack occurred a day earlier. The attack on the 48-inch pipeline from southern oil fields to two offshore Gulf terminals came as oil prices hovered at record highs, partly driven by concern that instability in Iraq would keep interrupting the country's exports. The attack cut export flows to 1.1 million barrels per day from 1.9 million, the official said. Other oil officials on Monday had said output was halted in response to threats from militiamen loyal to Shia leader Moqtada al-Sadr. An aide to Sadr has denied such threats were made. Clashes between Sadr's supporters and US-led forces have spread to the deep south - a centre of Iraq's oil industry. Iraq's South Oil Company asked its Basra headquarters employees not to come to work for the second day on Tuesday, but officials said there were enough staff at stations and oil platforms to keep exports flowing. The two offshore terminals south of the city of Basra account for all of Iraq's exports. Sabotage has kept another pipeline running to Turkey from the north mostly shut since the US-led invasion last year. **PHOTO CAPTION*** The sabotage led to an instant surge in world oil prices. (Al-Jazeera)