The world’s largest independent oil trader, Vitol Group, is in discussions with Iraq to sell crude from Kurdistan when the pipeline flows from the semi-autonomous northern Iraqi region to Turkey resume, sources with knowledge of the talks told Bloomberg on Friday.
Exports from Kurdistan to the Turkish port of Ceyhan on the Mediterranean will resume on Saturday, September 27, following agreements reached between Iraq’s federal government, the Kurdistan Regional Government, and a group of international oil companies, Norway-based oil producer DNO ASA said on Friday.
Earlier this week, Iraqi Prime Minister Muhammad Shia al-Sudani said that “a historic agreement” has been reached, under which the Federal Ministry of Oil will receive crude oil produced from the fields in the Kurdistan Region of Iraq and export it through the Iraq–Türkiye pipeline.
“This ensures fair distribution of wealth, diversification of export outlets, and encouragement of investment. An achievement 18 years in the making,” al- Sudani said on X.
Now Vitol is discussing a deal to receive crude from SOMO, the state oil marketing company of Iraq, at the Turkish port of Ceyhan for sales on the global market, according to Bloomberg’s anonymous sources with knowledge of the talks.
A separate deal could also be in the works and it would entail Vitol selling crude on behalf of international companies working in Iraq, the sources added.
Oil exports from Kurdistan have been halted for two and a half years, after they were shut in in March 2023 due to a dispute over who should authorize the Kurdish exports.
The resumption of flows on September 27 is expected to add about 230,000 barrels per day (bpd) of oil from Kurdistan to the international market.
Additional supply from Kurdistan is set to hit the oil market at a time when analysts, forecasters, and traders expect oversupply to start building with the end of the peak summer demand season.
By Tsvetana Paraskova for Oilprice.com
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