SINGAPORE: Iraq has set the official selling price (OSP) of its Basra Light crude, loading in January to customers in Asia, at 80 cents a barrel premium to Oman/Dubai quotes, down 10 cents from the month before, a trade source said on Tuesday.
The cut was smaller than expected and narrowed Basra Light's price gap to Saudi's Arab Medium to 30 cents a barrel.
This could weigh on the Iraqi grade's spot differential when February loading cargoes trade later this month, a second trader said.
Basra Light has been priced at a discount of 40 cents to $1.10 a barrel to Saudi's Arab Medium in 2013, down from premiums to the Saudi grade a year ago, allowing Iraq to overtake Iran to become China's fifth-largest supplier.
Iraq is planning to lift oil output by more than a million barrels per day (bpd) to over 4 million bpd in 2014, even as the Organization of the Petroleum Exporting Countries renewed last week its 30 million bpd output cap for the first half of 2014.
The December Basra Light price for Asian buyers had been set at a premium of $0.90 a barrel to the average of Oman/Dubai quotes. (Reuters)