Iraq’s federal state marketer Somo has sold Qayara crude oil on board the Marshall Islands-flagged ST1 VLCC offshore Sohar in the Gulf of Oman. Ali Nizar, Somo’s Director General, told the country’s parliament on 20 September that his company offered volumes of the heavy ultra-sour grade (<17°API, 7% sulfur) for lifting outside the Strait of Hormuz and that it planned to begin shuttling Basrah grades and fuel oil soon. MEES understands that Somo has finalized a tender for 2mn barrels of Basrah Heavy to be sold via STS in the Gulf of Oman.
Iraq has been selling crude on an FOB basis from Basra to trading firms at steep discounts; the firms then resell the cargoes at a premium outside the strait. This month, discounts of $26.5/B and $28/B were offered for Basrah Medium and Heavy, respectively, according to Mr Nizar. Selling crude for STS loading directly allows Iraq to avoid these discounts, although it has to carry the risk and shipping costs. (CONTINUED - 203 WORDS)