Region: Iraq rushes to submit oil offers amid rising shipping costs
Region: Iraq rushes to submit oil offers amid rising shipping costs
9-26-2026
Information/Translation…
A report by Rigzon, published Saturday, revealed that the Iraqi State Oil Marketing Company (SOMO) has offered crude oil shipments amid difficulties in purchasing cargoes from the depths of the Gulf due to soaring shipping costs.
The report, translated by Al-Maalomah News Agency, stated that, “According to sources familiar with the matter who declined to be identified, the availability of additional oil for purchase (an indication of some traders withdrawing) prompted SOMO to offer crude shipments for September to at least two companies. If Iraq is unable to find buyers or tankers, these disruptions could increase upward pressure on crude prices at a time when shipping costs are skyrocketing and global markets are facing severe volatility.”
The report further explained that “shipping oil using Very Large Crude Carriers (VLCCs) from the Gulf of Oman to East Asia adds approximately $20 to the price per barrel, according to Bloomberg calculations based on Baltic Exchange data. This amount represents roughly one-fifth of the value of crude, which currently exceeds $100 per barrel at loading, compared to a fraction of the delivery cost prevalent before the war.”
The report explained that “due to its geographical location further from the Strait of Hormuz, Iraq faced greater difficulties compared to some of its neighbors regarding shipping, relying instead on trading companies to market and transport its crude oil. Iraq offered significant discounts to incentivize buyers, reducing prices for its Basra Medium and Basra Heavy grades in recent tenders.”
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