Trafigura gets gasoline to Iraq despite blacklist

* Trafigura was blacklisted after buying Kurdish oil

* Iraq says it alone has legal right to export oil

* Traders say Trafigura supplying via little-known Sima

LONDON/DUBAI, Feb 6 (Reuters) - Trader Trafigura is still

indirectly supplying gasoline to Iraq through another firm, four

industry sources said, despite being blacklisted for dealing

with the Kurdistan region, at loggerheads with Baghdad.

Trafigura, which had been a major supplier of gasoline to

Iraq, declined to comment. Last year it had delivered as much as

60,000 tonnes a month, worth more than $65 million at current

prices.

Due to the size of Iraq's tenders, traders closely monitor

purchases by its State Oil Marketing Organisation (SOMO) though

few have the logistical network and capability to turn sales

there into profitable business.

Trafigura was one of the few, but was banned from

participating in tenders for 2013 after buying Kurdish oil.

Accordingly, SOMO last November finalised its deal to buy

1.56 million tonnes of gasoline from a pool of suppliers that

excluded Trafigura. The contract was awarded to rival oil firms

Vitol and Glencore, along with oil major BP and trading company

called Sima.

But while Trafigura's name may not be on the suppliers list,

traders say, the Swiss firm is behind the gasoline supplies of

Sima, an Iranian-Azeri company registered in Fujairah with an

address in Dubai.

When asked whether gasoline from Trafigura's tanks was being

used to supply Iraq, officials at the state marketing firm said

they would not comment on rumours.

Traders say that a number of vessels delivering gasoline to

Iraq's southern Khor al Zubair terminal for Sima loaded their

cargoes from Trafigura's storage tanks at Jebel Ali in the

United Arab Emirates.

"Two vessels have been booked for January," said a gasoline

trader, listing tankers that loaded from Trafigura's storage and

had been booked by Sima for delivery to Iraq. "The High Current

and the UACC Al Medina."

Shiptracking data shows both vessels heading to Khor Al

Zubair from Jebel Ali over the past week and a second trading

source confirmed the two vessels were delivering gasoline to

Iraq for Sima.

A port document obtained by Reuters showed that High Current

was anchored at the Iraqi terminal on Jan. 30 with a 16,500

tonne cargo and had been chartered by Sima.

The delivery was due to be followed by the UACC Al Medina

arrival, scheduled for the start of February, according to ship

tracking data.

"It's a well-known secret that Trafigura back Sima's

deliveries to SOMO," said another gasoline trader. "Hardly a

secret really. "

Trafigura declined to comment on whether Sima's vessels had

loaded gasoline from its storage tanks and repeated calls to

Sima's office in Dubai were unanswered.

KURDISH PROBLEM

Operating in Iraq has become a balancing act for many

international oil firms caught between long-standing ties with

the south and new prospects offered in the north by Kurdistan's

autonomous government.

Baghdad views independent exports from the Kurdish Regional

Government (KRG) as smuggling and any deals to produce oil

signed without its consent as illegal. The central government

says the state-owned marketer is the only body legally entitled

to export Iraqi oil.

But other buyers of Kurdish extra light oil condensate like

Vitol have faced few repercussions.

Iraq's oil minister Abdul-Kareem Luaibi said Vitol had

apologised to the Iraqi government for buying Kurdish oil that

was exported via Turkey without Baghdad's permission.

Vitol remains on its list of partners this year for both the

supply of gasoline and gasoil products.

The ban on Trafigura was not intended to impact crude

contracts as like most trading houses, the Swiss-based firm is

not entitled to buy crude oil from Iraq as SOMO deals only with

end-users.

Despite being OPEC's second largest crude oil producer,

years of violence, militant attacks and low investment have

forced Iraq to rely on imports to meet demand for oil products

fuel like gasoline as its own refineries struggle.

"Trafigura's Iraq business has been very important to them,"

a Turkey-based gasoline trader said.

"I wondered what they would do when they had problems with

Iraq. Then Sima appeared in the tender... it wasn't difficult to

figure out they were in close cooperation with Trafigura."

(Reporting by Jessica Donati and Humeyra Pamuk, editing by

William Hardy)

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