Dubai Mercantile Exchange (DME), the international energy futures and commodities exchange in the Middle East, has concluded its latest Basrah Light auction on 20 September 2017, on behalf of Iraq’s National Oil Company, SOMO
The two million barrel cargo of Basrah Light was awarded at a premium of US$0.13 per barrel over the November Basrah Light Official Selling Price (OSP).
Around 20 companies participated in the auction with 14 bids received during the two-minute auction, said DME.
DME has now hosted 13 auctions on its platform since January 2016, with a total of 21.6 mmbbl being sold, which generated premiums worth US$13.7mn. Four different crude grades have been sold via the platform, including Oman crude oil blend, Basrah Light, Basrah Heavy and Malaysian Kimanis.
Speaking to the press, Ahmad Sharaf, chairman of DME, said, “DME auctions allows sellers to access a large pool of potential buyers, and what would traditionally take many hours of phone conversations can now be accomplished during a two-minute auction.”
More than 60 companies from around the globe are registered to participate in DME auctions, he added.
“The success of DME auctions underlines the need for price discovery mechanisms and greater transparency in the region. It has enabled national oil companies to assess their monthly official selling price and adjust it to find fair value for national resources,” Sharaf elaborated.
He further said that DME is working on a reverse auction, aiming to helping buyers procure commodities to meet domestic demand.
