Nigerian crude struggles for buyers as rival Angola excels
With stiff competition for buyers in Europe and Asia from both Mediterranean and U.S. oil grades, Nigerian crudes have felt the pinch badly in the past few weeks.
Consequently, the influx of U.S. grades into refineries in northwest Europe and the Mediterranean have continued to undermine the Nigerian market which has resulted in a handful of cargoes from Nigeria’s June loading programme remaining unsold, Reuters reported quoting traders.
Force majeure on exports of Nigeria’s Bonny Light crude have remained in place, according to a spokesman for Shell on Wednesday, while repairs are ongoing on the Trans Ramos pipeline, which feeds crude to the Forcados terminal.
While Nigerian grades are struggling for the competitive oil market Angolan cargoes were said to be gradually clearing as at Wednesday, helping nudge crude differentials higher.
State oil firm Sonangol was said to be offering Dalia at a discount of $1.30 to dated Brent. Only a couple of cargoes remain from the June programme and about half the July programme has now sold, although Asian buyers have been more reticent in the last few weeks, traders said.
China’s state-run oil trader Unipec offered July-loading Angolan cargoes in the window, including Plutonio at dated Brent minus $1.20 a barrel on a free-on-board (FOB) basis, and Girassol at dated Brent minus 20 cents a barrel FOB, a touch stronger than the previous day, but without unearthing any buyers.
Unfavourable arbitrages both east and west have hurt demand for West African light sweet crudes, particularly from traditional buyers such as Indian refineries that have started to snap up shale instead.