Financial Energy Review
by James Ikenna……,
There are strong indications that Europeans buyers are dumping Nigeria and some African crude oil and turning to Norway due to proximity.
Crude oil from Nigerian and some African Crude oil are getting less attractive to some buyers in Europe. The reason being that these category of buyers seem to prefer producers close to them.
Though crude oil from Nigerian has inched up in price yesterday but refiners in Europe are going the way of the Norwagians because of proximity.
Though the Nigerian and Angola crude have continued to face difficulties attracting buyers, as European refiners continued to snap up oil closer to African crude oil grades even when the African grade experienced slight increase in price
despite fall in freight rates due to the poor global demand due to a sharp
It is said that price differentials gained some ground from historic lows brought on by the coronavirus pandemic. Moreso, it is believed that few spot prices emerged as traders kept them largely confidential, This is to give some traders advantage incase there is suden price move for them to have a good deal..
Some heavier Congolese and Angolan grades were especially favoured, with signs pointing to an improvement in Chinese refinery activity and lower rates for VLCC tankers..
Perenco awarded a tender of Congolese Djeno crude loading on June 11-12 to a Chinese buyer.
Angola’s Sonangol sold a cargo of Cabinda at or near its asking price to a Chinese independent refiner late last week despite rising prices, such as Azeri and Algerian Saharan blend, rather than risk later deliveries from West Africa.
Traders also have continued to experience significant cuts to Nigerian and Angolanexport plans for May and June in line with the OPEC+ producer pact to rein in output and as a result of poor sales.
Deferrals of some shipments from May to June and variations in the volume of each cargo mean actual compliance will be hard to gauge, they added, and can depend much on whether prices recover.
