Asian oil importers cannot be sanguine over Iraq | GulfNews.com:
"Have Asia’s oil buyers and traders become so inured to supply disruptions that the potential disintegration of the world’s fourth-largest crude exporter barely causes a ripple in regional markets? The stunning victories of the hardline Islamic State in Iraq and the Levant (ISIL) in capturing Iraq’s second city Mosul and advancing on the capital Baghdad have grabbed headlines and moved prices, yes, but do not yet appear to have raised long-term supply worries.
Global oil benchmark Brent gained 3.2 per cent from June 10 to close at $113.02 a barrel last Thursday, indicating some level of concern about developments in Iraq. The key Middle East marker, the Dubai Mercantile Exchange’s Oman futures, rose by 2.8 per cent over the same period.
The DME contract is more relevant for Asian crude buyers, given their reliance on heavier, more sour grades from the Middle East, as opposed to light, sweet crudes such as Brent. And with the forward DME curve remaining in “backwardation”, it seems evident that there is little concern in Asia that supplies from Iraq will be at risk in months to come."
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