BAGHDAD (Reuters) – Iraq has decided to freeze its first crude oil prepayment contract, which was aimed at boosting its finances, as oil prices rise, the country’s oil minister told BBC Arabic on Sunday.
“We were concerned that oil prices would not rise above $ 40 when we announced this agreement for the first time in Iraq ‘s history,” Ihsan Abdul Jabbar told the channel.
Brent Crude has been trading above $ 60 per barrel recently.
Asked about the status of the prepayment of crude oil contract, Oil Minister Abdul Jabbar said: “With the start of this year and the stability of the economy as a result of rising oil prices, we decided to freeze this option. ”.
Chinese state oil trader Zhenhua Oil Corp. had emerged as the forerunner in a bid to buy Iraqi crude for five years after it submitted the “most competitive bid” in the bid held by Oorac oil market SOMO. attracted participation from international oil companies, trading houses and Chinese and Indian refineries.
An Iraqi OPEC member was seeking a five-year advance payment starting in January 2021 to December 2025 to repay it with shipments of crude Basra, according to a letter sent by the state oil market SOMO to the cargo. -they bought and saw Reuters.
Under the prepayment contract, the winner of the SOMO offer was to pay about $ 2.5 billion as a prize for 48 million barrels of crude between July 1, 2021 and June 30, 2022.
Reciting with Ahmed Rasheed; Edited by Edmund Blair and Bernadette Baum