Nigeria Struggles to Find Buyers, For N159bn Oil

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Nigeria Struggles to Find Buyers, For N159bn Oil

By Correspondent

Nigeria through its March crude programme is finding it difficult to find outlets, with some 25 million barrels still unsold even as the April loading programme is expected to start arriving this week, traders have said. This serious issue has made offers for the oil go quiet as those holding the cargos wait for the uneager buyers to return to a market awash with choice for oil. Report reveals that as at February 16, the price of crude oil (Bonny Light) stood at $32.32 per barrel, while the CBN maintains that the official naira exchange rate was N197 against the dollar. Despite the fact that sellers were offering Qua Iboe, one of the country’s oil grades, at dated Brent plus $1.40, buyers are still either reluctant to buy or they’ve shown little interest and traders said values were less than $1 per barrel versus Brent. The reason for this, according to most buyers, is the differentials that would have to weaken somewhat in order to get the cargoes moving, particularly with refinery maintenance, coming and freight rates increasing to some destinations. Even at that, several tenders due this week from Indian refiners would likely take out a few thousand of the barrels. India is said to be the biggest importer of Nigerian crude oil. One of the reasons for this happening is because lower differentials for crude oil from other regions, particularly Urals and Mediterranean crude, were said to have piled pressure on sellers to lower differentials to encourage activity. The slow movement did not affect Angola’s March loadings. Angola’s March loading traded quickly due in part to larger term contracts with Chinese buyers that left less oil for spot trading. Angola is expected to export at least 1.8 million barrels per day in April, slightly more than in March.

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