Iraq offers discounts on Basrah crude during August

A ship is connected to the Basra Oil Terminal off the Iraqi coast in Northern Arabian Gulf near the port town of Umm Qasr. Photo: AFP Baghdad (IraqiNews.com) – Iraq’s State Organization for Marketing of Oil (SOMO) has offered considerable discounts on Basrah crude during August to attract customers to load shipments from within the Strait of Hormuz, according to a document reviewed by Reuters. SOMO asked potential term purchasers to designate contractual volumes of Basrah Medium or Basrah Heavy crude for complimentary onboard delivery from the Basrah Oil Terminal or other port-related infrastructure. SOMO provided discounts ranging between $25 and $27 per barrel on Basrah Medium, according to the loading period. It provided discounts of $27.80 to $29.80 a barrel for Basrah Heavy. According to shipping statistics released on Monday, maritime activity in the strategic waterway of the Strait of Hormuz has slowed over the weekend due to reports of assaults on vessels. Maritime traffic in the strait decreased due to ongoing military operations in the region and heightened shipping security risks. The significant price reduction aims to compensate for rising maritime insurance costs and freight expenses by transferring transit risk to purchasers.