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- Section : Iraq
Baghdad / Obelisk: Iraq canceled a paid agreement with a major country, describing the measure as necessary to achieve the country’s interest and revive the budget.
And according to a statement published by the S&P GLOBAL PLATTS website, Wednesday, June 23, 2021, “Iraq has a paid oil supply agreement worth two billion dollars with the (Zhenhua Oil) company of the Chinese government, and sold the crude oil designated for the deal to other customers, as Baghdad seeks to benefit from the high Prices,” a senior Iraqi official told the site.
The site stated, “Earlier this year, the Iraqi State Oil Marketing Organization chose Zinhua Company to be the winning bidder for the agreement, which included an advance payment of $2 billion for one year and called for the provision of 4 million barrels of crude every month.”
And the website quoted the deputy director of the “SOMO” company, “This agreement is not applicable at this stage due to the high oil prices. We are in a better position and are achieving additional profits that exceed what the Iraqi budget needs.”
For his part, a Beijing-based source familiar with the matter confirmed that “Zinhua and Sumo ended the deal,” noting that “the previous contracts of Zinhua for Iraqi crude were not affected.”
In the same context, the site quoted an Iraqi official as saying, “We have a good and even perfect working relationship with our Chinese customers, including Xinhua. They understand our position.”
He added, “We have current business ideas in general to increase the presence of SOMO and the presence of Iraq’s crude in the Chinese market and Asia in general,” noting that “this may include storage capacities, commercial activities or facilitating commercial activities in the same market, and even from there in China we can sell our crude.” and engage in other products business.
(SOMO) is in discussions with companies in Asia, including China, to store Iraqi crude there.
Last May, Iraq was China’s third largest oil exporter, after Saudi Arabia and Russia, while India and China are described as Iraq’s largest oil markets.
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