14:48 - 30/08/2017
A report by The New York Times that Iraq's proposal to change the pricing of crude oil in Asia is facing resistance from Asian refineries, which fears that the long time between pricing and delivery will put them at risk.
"The Iraqi Oil Marketing Company (SOMO) surprised its customers with new marketing plans by converting the Asian crude oil index from Basra to the stable pricing on the Dubai stock exchange, reversing the price assessments set by the global stock exchange Global Plats for pricing oil," the report said. .
"This move will affect about 2 million barrels of Iraqi oil exports to Asia, especially India, China and South Korea," he said.
"The change is significant and will be closely watched not only by the producers of the Middle East, but by everyone who is involved," said Singapore Managing Director Oystein Berntsen.
"The new method of using the monthly average of the Dubai bourse will delay the loading after the sale for two months while the oil producers in Saudi Arabia, Kuwait and Iran will sell their oil in the month of loading, which is a danger to buyers who will be notified in mid-September next step, Makes it difficult for buying companies to hedge against price fluctuations in advance. "
"We are not supportive of this idea and Iraqis must reform their supply program first before the standard is changed and the timing of the price makes it difficult to assess the comparison between crude oil grades," said one Asian oil producer.
Some oil traders said they "support the idea because knowledge of Iraqi oil prices two months before their delivery allows traders carrying Basra cargo without fixed destinations more time to determine where to sell their oil based on regional price differences."
Sumo has not commented on its motives for the change to the DME, but it can be seen that Somo is seeking higher amounts for the company. The average price of the Dubai exchange was about 20 cents higher than the Oman estimate. Ending / 25 z
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