The United Nations Security Council has approved the transfer of $200 million in oil-for-food revenue to the Development Fund for Iraq.
The Council also said an additional $20 million can be used to pay Iraq's past dues to the United Nations.
UN Secretary General Kofi Annan had recommended transferring part of the money that was in an account set up to pay the salaries of UN weapons inspectors charged with monitoring Iraq's weapons of mass destruction.
Iraq has been lobbying for months for the Security Council to stop using the country's oil revenue to pay for UN inspectors, saying the money belongs to the Iraqi people.
UN weapons inspectors left Iraq just before the March 2003 US-led invasion of the country, and the United States has barred them from returning.
Under the oil-for-food program, Saddam Hussein's regime was allowed to sell oil provided the revenues went primarily to buy humanitarian goods.
Some information for this report provided by AP and Reuters.