Chinese Refiners Turn to Iraqi Crude Amid Gulf Export Disruptions
Chinese refiners have found an alternative source of oil to make up for supply disruptions in the Gulf region. According to Bloomberg, they are buying 8 million barrels of Iraqi crude for prompt delivery. The Basrah Heavy and Basrah Medium grades are being purchased by Chinese companies.
The Strait of Hormuz has remained open despite Iranian efforts to block it. However, oil flows through this critical export channel have been severely reduced. For the week ending August 17, Marine Traffic reported just 95 vessel crossings, down from 118 the previous week.
Some tankers are evading detection by turning off their transponders, but this has not significantly increased oil flows. Saudi Arabia's exports have also been impacted due to Houthi attacks on its tankers and energy infrastructure. To avoid further strikes, it is shipping crude north through the Suez Canal.
Iraq has managed to boost its exports via the Strait of Hormuz, with 2 million barrels per day being exported since the start of the month, according to its state oil marketing company.