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Reuters reported that Abu Dhabi National Oil Co purchased millions of barrels of discounted crude from Iraq’s state oil marketing organisation SOMO through its trading arm ADNOC Trading. The deals made ADNOC the biggest lifter of Iraqi crude in both August and September according to two Iraqi energy sources cited by the news service. One source detailed an agreement for 32 million barrels in August with discounts ranging from $24.90 to $27 a barrel and a further 40 million barrels in September including 10 million at an $18 discount and 30 million at a $25 discount. The transactions have helped lift Iraqi exports that fell sharply in the early months of the regional conflict.
Export constraints and insufficient crude availability from Basra Oil Company meant ADNOC lifted only 20 million barrels of its August allocation despite the 32 million barrels assigned by SOMO the second Iraqi source told Reuters. The company has lifted 14 million barrels so far in September according to that person. A third source cited by Reuters said ADNOC bought about 20 million barrels via tenders for September and October lifting at discounts between $25 and $27 a barrel. These volumes reflect the steep price reductions available amid ongoing supply challenges in the Persian Gulf.
Kpler data cited across multiple reports places Iraq’s average daily crude exports this month at roughly 2 million barrels down from 2.354 million barrels in August but above July’s 1.374 million barrels. The attractive discounts have drawn additional buyers including China’s PetroChina Zhenhua Oil TotalEnergies Vitol Trafigura Mercuria and Unipec according to one market update that referenced the Reuters findings. Iraqi officials have worked to stabilise shipments following earlier disruptions tied to the Iran conflict.
ADNOC intends to process much of the acquired Iraqi crude at its Ruwais refinery one source familiar with the matter told Reuters. This approach allows the company to direct more of its own production toward international sales at higher prices. The strategy aligns with ADNOC Trading’s push to grow its presence in global oil markets over recent years as evidenced by its increased activity in spot tenders and term deals.
UAE crude exports have risen alongside the Iraqi purchases with Kpler data showing daily averages climbing to 3.236 million barrels this month from 2.886 million in August and 2.871 million in July. The combined flows underscore how traders are adapting to supply shifts caused by the regional tensions. ADNOC has not commented publicly on the specific Iraqi transactions in line with its standard practice for commercial matters.
Reuters noted that the purchases come as Iraq seeks to maintain revenue from oil sales which account for the vast majority of its government income according to longstanding economic assessments from the International Monetary Fund. The discounts compare with typical Brent benchmarks that have fluctuated in recent weeks due to geopolitical factors. Industry participants continue to monitor how these volumes affect overall market balances in the fourth quarter.
