Dubai – Business News Report|| Iraqi state oil marketer SOMO has offered crude oil for October delivery with significant discounts, aiming to attract buyers despite rising shipping costs and navigation risks in the Strait of Hormuz. Documents reviewed by Washington-based Energy Platform on Wednesday, September 30, revealed that discounts for Basra Medium and Heavy grades widened considerably.
Record Price Cuts for October Shipments
The discounts reached 34.50 dollars and 37 dollars per barrel for Basra Medium and Heavy respectively. These levels are higher than those offered for August and September shipments, which were under 30 dollars per barrel. The price cuts are calculated against reference indices for destination markets, with deliveries based on ship-to-ship transfers from the Basra oil terminal or Iraqi single-point moorings.
Asian Refiners Seek Cheaper Supplies
Global refiners and traders continue to show interest in Iraqi crude, with Asian companies seeking Basra supplies during October to benefit from lower prices compared to benchmark indicators. Indian Oil, India’s largest refinery, is bidding for one million to two million barrels of Basra Medium. The company requested loading between October 22 and 30, following a previous purchase of two million barrels from Mercuria at a discount of approximately 28 dollars per barrel against Dubai standard.
Export Volumes Show Monthly Growth
Average Iraqi oil exports rose to 2.65 million barrels per day in September, reflecting improved flows compared to earlier months. This represents an increase of 296 thousand barrels per day, or about 12.6 percent, from August’s 2.354 million barrels per day. Approximately 250 thousand barrels per day flowed through the Ceyhan port in Turkey, according to Reuters data.
SOMO Targets Capable Buyers
SOMO General Manager Ali Nizar Al-Shatri stated that Iraq sells oil to entities capable of loading and transporting crude outside the Strait of Hormuz. The move aims to maintain export flows amid logistical challenges. Major traders like Vitol and Abu Dhabi National Oil Company Adnoc have increased purchases. Vitol bought 25 to 30 million barrels for September, while Adnoc purchased 40 million barrels, up from 32 million in August.
This story was produced in the newsroom from the disclosed sources named above.
