Traders shun Nigeria’s crude
Nigeria’s dwindling revenue is set to worsen, as international crude oil traders have shunned the country’s export of Bonga crude oil grade for the months of May and June 2015, making it difficult for the country to find buyers for the product and putting the price of the commodity under pressure.
According to a report by Platts, the differentials for Nigerian crude grade, Bonga, are sliding due to the accumulated oversupply from the May and June program ahead of the release of the new July program this week.
On the demand side, Cepsa, Total, ExxonMobil are not buying Bonga at this stage and India’s strategic petroleum reserve alone cannot support the grade,” a trade from Europe stated. Market participants blamed the development on the oversupply of the Bonga crude grade, stating that the action is putting pressure on the already distressed prompt end of the curve primarily traded on a CFR/CIF (Cost & Freight/ Cost Insurance & Freight) basis.
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