(Updates with opening level, stock moves)
HONG KONG, Dec 20 (Reuters) - Hong Kong stocks opened lower on Friday, after the United States said Iraq was in "material breach" of a United Nations disarmament resolution, intensifying fears that a war between the two is all but inevitable.
The benchmark Hang Seng Index dipped 0.6 percent to 9,500.89 points by 10:07 (0207 GMT), holding steady at the key psychological support level of 9,500. Trade was light with only HK$527 million (US$67.6 million) worth of shares changing hands about nine minutes after the market opened.
Shares of Hong Kong's flagship airline Cathay Pacific Airways extended losses chalked up over the last few days after oil prices spiked to a two-year high as the White House reacted to what it called a deceptive weapons declaration from Iraq, holder of the second largest oil reserves in the world.
The stock was off 0.46 percent to HK$10.85.
China's largest offshore oil producer, CNOOC Ltd , also succumbed to mild profit-taking after a 7.1 percent rise this year. The stock fell 0.48 percent to HK$10.45.
Losers were outpacing gainers 105 to 42, with 673 stocks unchanged.
(US$1=HK$7.8)