By: OrePulse

Abu Dhabi National Oil Company (ADNOC) has become the largest purchaser of Iraqi crude oil in recent weeks, snapping up tens of millions of barrels at steep price discounts as Iraq's government works to move supply disrupted by the broader regional conflict, according to trading industry sources.

Through its trading division, ADNOC secured 32 million barrels from Iraq's State Organization for Marketing of Oil (SOMO) in August, purchased at discounts ranging from $24.90 to $27 per barrel. The company expanded its buying further in September, adding another 40 million barrels to its tally — 10 million barrels at an $18 discount, plus 30 million barrels at a $25 discount. A separate source indicated that ADNOC also acquired roughly 20 million additional barrels through tenders spanning September and October, with discounts falling between $25 and $27 per barrel.

However, the volumes ADNOC has actually taken delivery of have fallen short of what was originally allocated. According to one source familiar with Iraq's energy sector, although SOMO initially set aside 32 million barrels for ADNOC in August, the company ultimately lifted only 20 million barrels, hampered by export bottlenecks and supply constraints at Basra Oil Company. As of mid-September, ADNOC had received just 14 million barrels of its September allocation.

The steep, wide-ranging discounts reflect how much pressure Iraq faces to keep its crude exports flowing despite disruptions from the wider regional conflict, which has significantly limited the country's export capacity. SOMO's readiness to sell barrels at markdowns exceeding $25 relative to benchmark prices in some instances speaks to the urgency Baghdad faces in finding buyers willing to take on supply it might otherwise struggle to place in the market.

ADNOC isn't the only company taking advantage of this discounted crude. Chinese state-owned firms PetroChina and Zhenhua Oil are also competing for these barrels, alongside a roster of international trading houses that includes TotalEnergies, Vitol, Trafigura, Mercuria and Cathay Petroleum. This rush toward discounted Iraqi crude highlights just how rapidly global trading patterns are shifting in response to the conflict-driven supply disruption in the Gulf region, with both national oil companies and independent traders moving quickly to capitalize on the arbitrage opportunities created by the market dislocation.

These purchases further cement ADNOC's position as one of the most active national oil companies in international trading circles across the Gulf, making the company a major beneficiary of the ongoing market disruption while expanding its commercial presence in Iraqi crude flows. The magnitude of these discounts — tens of dollars per barrel below standard benchmark pricing — represents some of the deepest markdowns seen in Iraqi crude sales in recent history, underscoring both the urgency surrounding Iraq's export challenges and the additional risk premium buyers are demanding in exchange for taking on cargoes connected to an active conflict zone.

These transactions are unfolding against a backdrop of broader regional supply disruptions, including attacks targeting export infrastructure and the shutdown of Saudi Arabia's East-West pipeline — developments that have collectively tightened global crude availability and pushed prices toward their highest levels in months. In this context, discounted Iraqi barrels have become an appealing option for buyers equipped to manage the logistical complexities and reputational risks of purchasing crude from a country whose export infrastructure remains under considerable strain.