Iraq cuts Basrah Medium crude rate to $1.30 discount for Asia amid ongoing oversupply concerns in oil market | Today News

Iraq has reduced the pricing of its Basrah Medium crude for Asian customers for February, days after Saudi Arabia lowered the cost of its flagship oil to buyers in the biggest market.

State oil marketer SOMO reduced the Basrah Medium discount to $1.30 a barrel relative to the regional benchmark, down from $1.05 in January, Bloomberg reported, citing the pricing list.

Iraq is maintaining its pricing for the Basrah Heavy grade for Asia at the same level next month, with a discount of $3.60 per barrel.

Meanwhile, Saudi Arabia reduced the price of its flagship crude oil for Asia for the third consecutive month due to ongoing signs of oversupply in the market, according to a separate report by the news portal on January 6, 2026.

The revision comes as the Organisation of the Petroleum Exporting Countries and some of its allies decided to pause supply increases in the first quarter. During their weekend meeting, delegates mentioned they didn’t talk about Venezuela in the 10-minute video call and noted it’s too early to assess how the US capturing Nicolas Maduro, the country’s leader, might affect supplies.

Aramco also reduced its barrel prices across all grades for all regions, including the US and Europe.

Last year, global crude benchmarks declined roughly 20%, with Brent experiencing its largest annual drop since 2020. This was driven by increasing worries over a global oversupply after OPEC's earlier supply increases and higher output from competing drillers, the report said. The International Energy Agency forecasts a surplus of approximately 3.8 million barrels daily this year, it added.

Middle East crude markets have also declined, as the forward curves for grades such as the Dubai benchmark and Abu Dhabi’s Murban futures have gradually lost their upward momentum in recent weeks.

Apart from Venezuela, geopolitical risks across various regions remain a concern for the production prospects of OPEC members. These risks include the ongoing Ukraine-Russia conflict, US sanctions on Russia and Iran, and a generally bleak outlook from China, a key crude importer and significant customer for many OPEC countries, which also impacts the overall outlook sentiment.