West African Crude: Nigeria differentials fall further on slack demand

 

Nigerian crude oil price differentials fell further Thursday, on slack demand from Asian buyers who favour cheap competing grades.

Differentials of crude from Africa’s largest producer had stayed relatively robust in recent months, even as oil from the Middle East and Russia had fallen sharply.

However steadier supplies and a dearth of buying interest that has left cargoes unsold for weeks has finally seen differentials succumb.

A lack of tenders by Asian refiners for August cargoes means there is scope for more weakness, traders said.

“(Indian refiner) IOC has clearly moved to September with their buying tender, and apart from Indonesia, it looks like most other (Asian) buying is done, so maybe a few cargoes will have to clear at lower numbers,” a trader said.

NIGERIA

There are around 40 cargoes still available for August loading out of a total of 65.

Qua Iboe: Six of 13 August loading cargoes are still up for grabs, a trader said, mostly for later in the month. They traded at $1.50-$2 per barrel over dated Brent, but a cargo for July loading was offered at $1.20 over dated Brent in the window.

Bonny Light: Still five of six cargoes available for purchase, a trader said.

Royal Dutch Shell has yet to lift a force majeure on output from its EA field in Nigeria that was declared in June.

Shell is repairing equipment damaged by bad weather, suspending output of about 40,000 barrels per day.

ANGOLA

Cabinda: Offered at dated Brent minus $1.50 to $1.75 a trader said. Two vessels still available for purchase.

ASIAN TENDERS

BPCL bought two million barrels from Glencore in a tender, a trader said.

MRPL to a cargo of Djeno, a trader said.

The results of a Pertamina tender were expected later on Thursday.

— Reuters