Iraq Raises Basrah Light, Kirkuk Oil Prices for October to All Customers

Iraq, holder of the world’s third- largest oil reserves, raised the official selling prices for its Basrah Light and Kirkuk crude grades for October loading to the U.S. and Europe, the state oil marketing company said.

The price for Kirkuk crude to Europe increased the most, rising by $1.95 a barrel, and will sell at a premium of 15 cents a barrel to the Dated Brent benchmark, according an e-mailed statement today. Basrah Light to Europe will cost $1.50 a barrel more in October than in September and will sell at a narrower discount of $1.45 a barrel to Dated Brent.

U.S. buyers will see a fifth consecutive price increase for the grade, whose discount to the Argus Sour Crude Index narrows to $1.15 a barrel for October, making the crude 15 cents a barrel more expensive than the previous month. Kirkuk oil for U.S. buyers will climb 10 cents a barrel to a 35 cents-a-barrel premium above the benchmark.

Iraq’s price gain came after Saudi Arabia, the world’s largest exporter, increased prices on all of its crude grades to all buyers earlier this month. Iraq sold at least one-third of its crude to customers in Asia in 2008, according to most recent data available from the U.S. Energy Information Administration.

Iraq raised Basrah Light prices to Asia. The discount for the grade to Asia narrowed by 20 cents a barrel, to $1.35 a barrel below the Dubai-Oman benchmark for loading next month.

The country aims to increase its stagnant crude production with help from foreign oil companies such as Royal Dutch Shell Plc and Exxon Mobil Corp., which have secured contracts to develop fields suffering from years of under-investment. The Iraqi statement did not give any details on sales volumes.

To contact the reporter on this story: Anthony DiPaola in Dubai at adipaola@bloomberg.net.

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