Lacklustre Demand Weighs On Spot Prices for West African Crude

reuters logoGENEVA, May 24 (Reuters) – Angolan and Nigerian differentials were under pressure on Friday as some Asian refiners snubbed west African grades in favour of light, sweet crude from other regions.

Earlier this week, India’s Mangalore Refinery and Petrochemicals (MRPL) opted to purchase Omani and Yemeni crude oil instead while Petral was also heard to have sourced July crude from outside the region.

Traders said only a few Nigerian cargoes from June have yet to clear and spot trade was seen shifting to July on Friday.

Offers for the benchmark Qua Iboe grade were reported at around dated plus $3 a barrel but most market participants assessed the grade at around 50 cents below that level and about 20 cents below levels earlier this week.

West Africa is seen as increasingly reliant on European demand for its oil, given that a more than $1 increase in the Brent/Dubai spread since the start of May has made exports to Asia less attractive.

“This leaves Europe as the core destination for Nigerian barrels, but the region already has plenty of Caspian and North Sea barrels on offer, much of which is available at discounts to Dated Brent,” said JBC Energy analysts.

NIGERIA

* Qua Iboe: Seen at around dated Brent plus $2.50 a barrel.

* Brass River: Nigeria will load an additional two tankers of Brass River oil in July, a revised shipping list showed on Friday, lifting total exports to around 1.79 million bpd.

* One of the two added cargoes – a 350,000 barrel tanker allocated to Eni – was deferred from June. The second was a 180,000 barrel Brass cargo, trading sources said.

* Bonny: A force majeure on exports declared in mid-April remains in place, Shell confirmed on Thursday.

ASIAN TENDERS

* Taiwan’s CPC was heard to have bought two cargoes of Angolan crude oil as part of its July tender. The grades were heard to be Cabinda and Nemba, although the sale prices were not immediately available.

DATABASE

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http://bond.views.session.rservices.com/ce (Reporting by Emma Farge; editing by James Jukwey)

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