Nigeria’s crude exports to Asia, the biggest consumer of the country’s oil, has dipped by 13 per cent, August crude loading has shown.
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Reuters, which reported this at the weekend, revealed that Asian countries, including India and China, that imported 2.43 million barrels per day from West Africa in April, turned down 590,000 bpd crude from the region in August.
This translates to a total of 18.29 million barrels in August, out of which Nigeria has 6.4015 million barrels.
Prominent among the crude grades affected by this dip are Nigeria’s Agbami, Qua Iboe and Bonny Light. Others are Ghana’s Jubilee, Equitorial Guinea’s Zafiro Blend and Ceiba, multiple cargoes of Angola’s Cabinda and Dalia.
Nigeria had earlier dislodged Saudi Arabia as India’s largest crude oil supplier in May, and Reliance increased its purchases of African crudes that month to a quarter of its total, up from 19 per cent a year earlier.
West African crude oil exports to Asia were, however, expected to fall to 1.84 million barrels per day (bpd) in August, Reuters’ data and a survey of traders showed.
Nigeria accounts for about 35 per cent of this total fall, indicating about 600,000 barrels per day slide in August crude exports.
Nigeria has slashed prices to help it find new outlets as it grapples with shale oil-induced oversupply; official differentials hit 10-year low in June.
But new sales have been hindered over the past month by traders looking to offload millions of barrels of oil held in storage.
Traders warned that such sales could mask the total amount of West African crude that Asian buyers are taking. “The crude that’s going to Asia will have been a mixture of floating, June and July,” one trader said.
Slower buying by Indian independent refiners such as Reliance was the primary factor behind the overall decline of 13 per cent from July, highlighting the fickle nature of buyers in an oversupplied market. Indian refiners have used the steep drop in crude prices and ample global availability as an opportunity to expand their crude slates and experiment with new grades, traders said. “India and Reliance in particular, took fewer West African (cargoes),” another trader said.
“The eastern sweet crudes came off and shipping rates from West Africa to Asia were higher, so it makes sense.” Reliance booked as few as two cargoes for August loading, compared to at least seven for July loading.
The overall decrease, however, still puts Asia as the top buyers of West African crudes; July, at 2.1 million bpd, was the second-highest export total to Asia this year and April’s 2.43 million bpd marked the highest in at least 10 years.
Those booking cargoes included China’s Unipec, the trading arm of Asia’ largest refiner Sinopec, and Day Harvest, India’s IOC, BPCL and MRPL and Taiwan’s CPC.