Iraq to Sell Crude Oil through Auction



Iraq will try to sell a supertanker of Basra Light crude oil at auction through the Dubai Mercantile Exchange (DME), a part of the US-based CME Group, according to Financial Times.

This move to sell the 2m barrel cargo follows Oman’s recent auction sales of two cargoes through the DME, which acts a trading venue for physical oil deals in the region.

The biding will start on Friday. Traders can bid though an electronic platform, but, a premium must be paid to Somo’s official selling price for June.

Somo is Iraq’s state oil marketer. However, the Kurdistan Region in Iraq sells its oil independently of Somo.

Another caveat for the highest bidder is that they will need to agree to ship the crude oil only to Asia.
Besides relying on traditional methods of selling its oil, such as long-term supply deals, Iraq is expanding to others means of increasing its sales, such as forming a joint venture between Somo and Litasco, the trading organization of Russia’s Lukoil,-one of the largest global producers of oil.