• Thursday, February 29, 2024
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BusinessDay

West Africa Crude: Libya exports, supply glut pressure Nigerian oil

oil-lifting

Assessments of Nigerian crude oil differentials for October loading cargoes fell further on Friday on strong competition from oil from other regions and slack European demand.

A glut of physical oil has led to increased storage of West African and other grades of oil, and this is likely to keep differentials under pressure in coming months, traders said.

There were around 20-25 cargoes of 63 for October still available for purchase about a week before November cargoes come to market.

Increasing sales from Libya have pressured Nigerian differentials as it is of a similar light, sweet quality, traders said.

A trader said that activity from the Ras Lanuf oil terminal in Libya after around a month of no vessels departing indicated that exports would likely soon increase further.

The tanker Aegean Pride left Ras Lanuf on Sept. 11 with destination Genoa in Italy. Tracking showed the vessel was 85 percent full and last seen positioned off the coast of Sicily.

Libya’s oil sector is under complete government control despite rising violence in the North African country, with production expected to rise to one million barrels a day in October, Prime Minister Abdullah al-Thinni said on Wednesday.

Angolan crude for October loading has nearly sold, with only one or two cargoes left.

It has benefited from a lower premium of Brent crude -against which it is benchmarked – to Dubai crude DUB-EFS-1M, making it more affordable to Asian refiners.

NIGERIA

Qua Iboe: Offers for October cargoes are around dated Brent plus $1.30, but there was a bid at 30 cents over dated Brent, traders said. Traders expected deals to be done at around dated Brent plus $1.

Nigeria is scheduled to export about 1.86 million barrels per day of crude in October, according to loading schedules.

ASIAN TENDERS

IOC bought Agbami, Okoro and Qua Iboe cargoes for November loading from BP and Glencore through a tender on Thursday, a trader said.

A tender from Petrovietnam to buy Nigerian cargoes is expected next week.