EU buyers ditch Nigerian crude for cheaper alternatives

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Nigeria is facing a hard time finding buyers for its crude as 20 cargoes of June loading offered at slightly higher prices struggle to find buyers because customers in Europe sought cheaper barrels in the Mediterranean and from Russia, according to crude oil loading schedule seen by Reuters.
This situation is worsened by the force majeure on the Amenam stream and Bonny Light streams, which has continued to cause loading delays. This could significantly impact implementation of the budget and government programmes for the year.
The Amenam-Kpono field, operated by Total sits astride offshore blocks OML 99 and OML 70, about 30km off the eastern part of the Niger Delta while Bonny Light is a light-sweet crude benchmark crude for all West African crude production, the field is operated by Shell in Nigeria.
In the past, large orders from India offsets market decline from Europe but even Nigeria’s major buyer India was heard not to have significantly stepped up purchases despite having been Iran’s number two customer, Reuters said.
Oil market analysts now consider Nigeria the wild card in a market where disruptions to production from Venezuela and Iran has led the Organisation of Petroleum Exporting Countries (OPEC) to dig into spare capacity. US sanctions on Iran and Venezuela has cut global production by 1.85 million bpd from 2018 peaks according to Reuters estimates but Nigeria cannot fill the capacity.
Nigeria’s inability to strengthen its foothold in the global oil market is already having a telling effect on the local economy. According to the latest quarterly review of Nigeria Extractive Industries Transparency Initiative (NEITI), Federal Account Allocation Committee (FAAC) disbursements between January and March 2019 dropped to $1.929 trillion as against N1.938 trillion disbursed for the same period in 2018.
“Oil prices experienced a downward