The cost of shipping oil from Nigeria surged the most in more than a year at the end of a week in which some owners were said to be staying away from Africa’s largest oil producer.
Freight for ships hauling about 1 million barrels of crude from Nigeria to Europe jumped almost $16,000 a day on Friday, the biggest gain since April 2022. It rose to just over $64,000 a day, data from the Baltic Exchange show.
Earlier in the week, at least two shipowners said they were keeping their vessels away from Nigeria after a series of multimillion dollar tax bills were sent out, seeking to claw back unpaid duties from 2010-2019.
“Some owners have decided to stay away and, if nothing else, it’s really shifted sentiment because there’s a smaller pool of vessels willing to go there,” said Halvor Ellefsen, a tanker broker at Fearnleys Shipbrokers UK Ltd.
This week some businesses received demands from Nigeria’s Federal Inland Revenue Service, according to a member notice by industry group Intertanko seen by Bloomberg. They cover the period from 2010 to 2019 and range in amount from $400,000 to $1.1 million per vessel. In aggregate, some claims reach tens of millions of dollars.
As a result, at least two shipowners, who asked not to be identified discussing commercial matters, are steering clear of Nigerian ports to avoid the risk of having their ships arrested. Tanker earnings from West Africa to Europe have soared more than 42% in three days so far this week, according to Baltic Exchange data.
Ships staying away from Nigeria makes it easier for those owners still willing to go there to get higher rates for their vessels.
Many of the tax bills referred to a previous law published by Nigeria’s revenue service in July 2021. That measure says any vessel carrying crude oil, gas or refined fuels from Nigeria is liable to pay tax there.
Intertanko couldn’t immediately comment. Nigeria’s FIRS didn’t respond to multiple requests for comment.