Why are Chinese refiners increasing purchases of Iraqi crude oil, and which grades are they buying?

Chinese refiners, including Rongsheng Petrochemical Co. and some state-run processors, are snapping up Iraqi crude—specifically Basrah Heavy and Basrah Medium—to help plug a supply gap caused by logistical disruptions: Saudi oil exports under long-term contracts may remain low next month due to Red Sea shipping issues, and Chinese refiners missed out on supplies in a recent ADNOC tender. At least 8 million barrels of Iraq’s Basrah grade have been purchased for prompt delivery, with some Basrah Medium sold at a premium of just under $10 a barrel to the Dubai benchmark on a delivered basis.

How is Iraq managing its oil exports amid regional instability, and who is facilitating the shipments?

Iraq is not involved in shipping its own crude; instead, it relies on global trading houses and energy companies—including Vitol Group, TotalEnergies SE, and Abu Dhabi National Oil Co.—to transport its oil out of the Persian Gulf, using discounts as an incentive. This approach contrasts with UAE’s ADNOC and Saudi Arabia, which handle their own shipping. Despite persistent threats to shipping and the ongoing Iran war, Iraqi exports through the Strait of Hormuz rose to about 2 million barrels a day in August, with many tankers switching off transponders during transit.

Chinese Refiners Snap Up Iraqi Oil as More Supplies Exit Hormuz

Aug 19, 2026

Chinese refiners including Rongsheng and Cnooc purchased 8 million barrels of Iraqi Basrah crude to address supply gaps amid Red Sea logistics issues affecting Saudi and UAE exports.

bloomberg

2026-08-19

Chinese Refiners Snap Up Iraqi Oil as More Supplies Exit Hormuz

Chinese Refiners Snap Up Iraqi Oil as More Supplies Exit Hormuz

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