Iraq is to change the price benchmark for selling oil to Asia, according to media reports.
Reuters news agency claims that state-run oil marketing company SOMO is to switch its Far East customers over from Basra crude to Dubai Mercantile Exchange Oman futures from the start of next year.
According to a copy of a letter seen by Reuters on Monday, customers were told: “In an effort to realize the intrinsic value of our crude exports to Asia as to be in alignment with the recent market perception, we are contemplating a change of the current pricing formula for the Asian market.”
The move would be a step change for Iraq’s oil industry, which is overshadowed by Saudi Arabia – Opec’s biggest producer – who set the price trend for other Middle East producers.
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