Buoyed by growing demand from Europe and India, Nigerian crude oil export for March loading have sold well with less than 10 cargoes unsold from the March programme.
More Nigerian crudes are expected to head to Europe in March compared to February, which was boosting some of the Nigerian light sweets, sources told Platts. Europe is the largest regional importer of Nigerian oil.
West African Suezmax freight rates have fallen sharply in the last months, making the West Africa-to-Europe arbitrage more economical.
Freight rates for a Suezmax on a West Africa-to-Northwest Europe route were pegged near Worldscale 50-55 Wednesday, a fall of almost w80 points since early January.
At least 25 cargoes or 36 percent of the Nigerian cargoes loading in March will be going to Europe, compared with at least 15 to 17 cargoes or 25 percent in February, according to Platts tracking data.
“There are not many Nigerian cargoes left from the March programme. There are less than 10 cargoes remaining, but these cargoes are stuck a little now because of a lack of activity. But the market has been stable because freight has come down a lot which has meant some more cargoes will go to Europe”, said a trader.
Some of the grades still available included Bonga, Bonny Light, Qua Iboe, Forcados and Antan, traders added.
Twelve Nigerian crude cargoes, each carrying close to 1 million barrels, will be going to India in March, making it more than 16 percent of the export programme compared to nine or 15 percent in February, the tracking data showed.
Indian Oil Corporation has already bought up to 8 million barrels of West African crude for April loading, the majority from Nigeria, which should continue to support the market.
India’s import of Nigeria crude oil is projected to grow by 26 percent to reach 116.8 million barrels in 2014 all things being equal, according to BusinessDay Research and Intelligent Unit (BRIU) in its current edition of Nigerian Oil and Gas Industry Report yet to be released.
The Nigerian National Petroleum Corporation (NNPC) quarterly petroleum information shows that in the first three quarters of 2013, India had the top spot of Nigeria crude oil export with import of 73.12 million barrels.
Last year, India emerged as the single largest importer manageof crude oil from Nigeria after significant drop in United States’ (US) imports from the country as production from shale resources in the US continued to surge.
For the past decade, the US imported between 9 percent and 11 percent of its crude oil from Nigeria. However, this share fell to an average of 5 percent in 2012 and 4 percent from January to August 2013. As a result, Nigeria fell from being the fifth largest foreign oil supplier to the US in 2011 to eighth in 2013, according to the Energy Information Administration (EIA).
As US imports of Nigerian oil decreased over the past few years, European imports increased, the EIA said, adding that European imports of Nigerian crude increased by more than 40 percent in both 2011 and 2012 and were 626,000 bpd and 889,000 bpd, respectively.
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