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Iraq Narrows Oil Discount

Iraq Narrows Oil DiscountIraq Narrows Oil Discount

Iraq narrowed the discount for April crude deliveries to Asian buyers by the most since November 2011, joining other Middle East producers in raising official selling prices amid signs demand is improving.

Iraq, the Organization of Petroleum Exporting Countries (OPEC)’s second-biggest producer, will sell its Basra Light crude at $2.80 a barrel below Middle East benchmark Oman and Dubai grades in April, the state-run Oil Marketing Co., known as SOMO, said Monday, Bloomberg reported.

That’s $1.30 less than the discount for March. Saudi Arabia last week increased the pricing terms for Arab Light sold to Asia, while Abu Dhabi and Qatar raised export prices. State-owned Saudi Arabian Oil Co. said last week it will sell cargoes of Arab Light in April at 90 cents a barrel below Asia’s regional benchmark. That narrows the discount by $1.40 from March, the biggest price increase since January 2012, according to data compiled by Bloomberg.

The imbalance in the global crude market will even out in the second half of this year, OPEC Secretary-General Abdalla El-Badri said Sunday.

Abu Dhabi National Oil Co. set its Murban crude at $56.55 a barrel for February from $46.40 in January, raising prices for the first time since June, according to a March 4 statement. Qatar also increased prices for Marine and Land crude in February, the state-run Qatar News Agency reported March 5.

The 12-member OPEC pumped about 30.57 million barrels a day in February, according to data compiled by Bloomberg. The group, which supplies about 40 percent of the world’s oil, kept its collective quota at 30 million barrels a day at a Nov. 27 meeting.

 

Financialtribune.com