West Africa Crude-Differentials weak, further falls likely

West African crude oil differentials faced further pressure on Monday, as buyers refrained from moving in to buy a substantial overhang of
cargoes available for July loading, even as more crude came to market.

There were around 15 Angolan cargoes for July loading still yet to be sold, around a week after the August programme came to market, traders said.

Around 13 of 54 cargoes for August loading had sold on term contracts, but none had moved on a spot basis, a trader said.

In previous months this year and through most of 2013, much of the available Angolan programme would have sold within a week of coming to market.

However competition from grades in different regions and subdued demand have forced sellers to push differentials lower.

“It’s hard to see any upside at the moment,” a trader said.

NIGERIA

Brass River is offered at around dated Brent plus $3.30 a barrel, This compares to a premium of $3.65 last Wednesday, a trader said.

Nigeria set the official selling price (OSP) for Qua Iboe and Bonny Light crude oil grades at dated Brent plus $2.55 a barrel in July, down 15 cents from June. See for the full list of July prices

ANGOLA

Initial offers from Sonangol for August cargoes were as follows, relative to dated Brent. A trader said these had not changed from Friday.
— Dalia: -$1.80
— Hungo: -$1.60
— Kissanje: -$0.30
— Mondo: -$1.60
— Nemba: -$1.00
— Palanca: +$2.50
— Plutonio: -$1.75
— Saturno: -$2.80
— Saxi: -$0.30