This would also be the first confirmation of large Kurdish oil shipments to Europe as autonomous Kurdistan is locked in a standoff with Baghdad over lucrative exports and faces repeated sabotage of the pipeline carrying crude to Turkey’s Ceyhan port.
Hungarian oil group MOL receives the bulk of its oil imports from Russia. But it has stepped up imports of oil from Kurdistan since the summer, the sources told Reuters without giving specific volumes, part of a wider increase in seaborne crude purchases for the country’s main refinery, Szazhalombatta.
“These are serious volumes, almost 40 percent of Szazhalombatta’s needs,” a trader said of total seaborne imports.
The sources said this would inevitably involve a reduction in imports of Russia’s Urals blend, which come via the Druzhba pipeline.
MOL declined to say if it was buying blends from Kurdistan. It confirmed, however, that it was increasing purchases of blends other than Urals, but added that Urals would remain the main blend for its refineries.
Kurdistan ramped up independent oil exports in June, saying it had no other choice but to sell oil itself after Baghdad failed to allocate money to the region from its budget.
Baghdad has repeatedly described independent Kurdish sales as illegal and explained low budget allocations by saying Erbil was not transferring enough oil to state energy firm Somo.
Oil exports from Iraqi Kurdistanآ rose in September to an average of 600,463 barrels per day (bpd), up by around 127,000 bpd from August, according to the Kurdistan region’s ministry of natural resources.
The trading sources also said that MOL had been using the JANAF utilized oil pipeline to bring in Kurdish imports from the Croatian port of Omisalj, displacing Urals in a conduit used to take the Russian blend from Hungary to Bosnia and Herzegovina.
“They get one to two cargoes a month. The pipeline from Croatia to the refinery is filled completely with Kirkuk,” one trader said.