Security Council Slaps New Sanctions on Libya : Mideast: U.N. acts to force Tripoli to give up Lockerbie suspects. But it stops shy of oil embargo that could affect Europe.

The U.N. Security Council, increasing the pressure on Libya to surrender two suspects in the 1988 bombing of Pan Am Flight 103, tightened economic sanctions a notch Thursday but stopped short of imposing an oil embargo that would cause real pain not only to the Libyan government but to much of Europe.

The new measures, added to sanctions in force for the last 19 months, freeze Libya’s financial assets held abroad and ban sale to the North African country of equipment needed for the oil industry. The new sanctions strengthen the international effort to force Libyan leader Moammar Kadafi to turn over for trial in the United States or Scotland--where the Pan Am 103 terrorist bombing occurred--two intelligence operatives suspected of instigating the tragedy.

The New York-bound jumbo jet exploded and crashed over Lockerbie, Scotland, on Dec. 21, 1988. A total of 270 people, on the plane and on the ground, perished. The explosive device, hidden in baggage, apparently had been smuggled aboard in Frankfurt, Germany.

In acting Thursday to put more pressure on Libya, the council balked at an American demand for a complete embargo on oil and petroleum products, the desert nation’s only valuable asset. European governments that buy large quantities of Libya’s low sulfur oil objected that the measure would damage them as well as the Libyans.

Libya earns about $9 billion a year from oil exports of 1.5 million barrels a day.

Diplomats conceded that Libya, which has known of the impending sanctions for months, probably has removed most of its money from banks expected to cooperate with the freeze and has stockpiled oil equipment.

U.S. Ambassador to the United Nations Madeleine Albright said the Clinton Administration has not yet decided whether it again will propose an oil embargo if the latest steps do not induce Libya to extradite Abdel Basset Ali Megrahi and Lamen Khalifa Fhimah. They are sought to face trial either in Scotland or in the United States, headquarters of now-defunct Pan American World Airways.

Kadafi’s government has said that it has urged the two suspects to surrender voluntarily but will not compel them to do so. Libya’s U.N. envoy, Ali Ahmed Elhouderi, said the United States and Britain have no right to demand extradition of Libyan citizens from Libya.

“Would they treat their own citizens the way they want to treat the Libyans?” he said.

Libya called the new sanctions unjust and said Western “imperialist states” used “pressure and threats” to force the council to adopt them. The report from the state-run Jana news agency was monitored by the British Broadcasting Corp.

The council vote was 11 to 0, with China, Djibouti, Morocco and Pakistan abstaining. Russia, which had threatened to veto the resolution, voted for it. The Russians were concerned that the sanctions would give Libya an excuse to fail to pay its debts, including about $4 billion owed for weapons delivered by the Soviet Union.

Sponsors of the resolution obtained Russian support by adding a provision specifying that the sanctions do not remove “Libya’s duty scrupulously” to repay its debt.

Because of the Russian objections, however, the United States, Britain and France--sponsors of the resolution--missed an Oct. 1 deadline for imposing the tougher sanctions. Two days before the earlier deadline, Libya told U.N. Secretary General Boutros Boutros-Ghali that it was ready to send the suspects to Scotland for trial. But it said later that it would send them only if they agreed to go.

In Tripoli, the Libyan capital, Megrahi and Fhimah said they are willing to be tried in Libya, Switzerland or some other third country but believe that there can be no fair handling of their cases in Scottish or American courts.

Jana quoted the two suspects as saying: “If they have genuine evidence against us, this evidence will stand against us in any third country, even in front of Libyan courts. If they have witnesses that they don’t want to appear before a Libyan court, they could bring them to Switzerland.”

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Six relatives of the victims of the bombing were in the gallery when the Security Council voted. Albright walked over to speak with them after the vote, saying, “I wish we could do more.”

Elizabeth Philipps, president of Victims of Pan Am Flight 103, which lists about 300 members from 125 American families, and who lost her daughter Sarah, 20, said: “I think they (Libyans) are suffering from these sanctions, and I believe the tightened sanctions will make a difference in their lives.”

But Susan Cohen, whose daughter Theodora was also a victim, complained that the added sanctions are inadequate--”a fraud and a farce.”

“Nothing is happening,” she said in a telephone interview with the British news service Reuters. “Take it out of the United Nations and have unilateral action by the United States. . . . If necessary, the U.S. must consider military action.”

Thursday’s resolution also calls on Libya to cooperate with France in investigating the bombing of a UTA airliner that exploded over Niger in 1989, killing 171 people.