West Africa Crude: Nigerian overhang clearing, diffs still under pressure

Nigerian crude oil cargoes for August loading are slowly finding buyers, traders said on Thursday, although downward pressure continued on Angolan and Nigerian differentials.

Weak refinery margins, ample supplies and lacklustre demand from big buyers such as China have all put pressure on West African crude differentials.

Less than 10 Nigerian cargoes loading in August are still available, although this means that demand for September cargoes has so far been sluggish.

“August barrels are slowly clearing, but September barrels are not moving,” a trader of Nigerian crude said.

“To be traded, the market has had to move down,” he added, referring to Angolan crude.

ANGOLA

Around half of September’s 55 cargoes have traded in spot and term deals, traders said.

Some grades were valued at lower levels against dated Brent than previously heard.

– Dalia: Valued at below dated minus $4.00 by one trader, down from an offer of minus $3.50 heard on Wednesday.

– Girassol: Valued at below dated minus $1.50, down from an offer at dated minus $1.00 heard on Wednesday.

NIGERIA
Qua Iboe: September cargoes were offered at dated plus $1.60, a trader said, down 10 cents from Wednesday. Traders
still assessed September barrels at dated Brent plus $1 or slightly higher.

Loading programmes point to Nigerian exports reaching the highest daily rate since May 2013. September’s total will load in 61 cargoes and is up from August’s revised rate of 1.82 million bpd.

– Reuters