Nigeria’s crude suffers low demand, cargoes await buyers — Report

Crude oil grades from Nigeria have faced tepid demand in the April trade cycle as ample availability of lower-priced alternatives such as US WTI, Caspian CPC Blend, and other Mediterranean grades enticed European buyers.

Argus Media, an independent energy and commodity price benchmarks provider, reported this on Thursday.

The report stated that the trade cycle has since shifted to May, “with as many as 15 April-loading Nigerian cargoes still looking for buyers,” according to market participants quoted by Argus Media.

However, a new Nigerian crude grade, medium sweet Obodo, is set to hit the market in April as Nigeria steadily adds to its crude offering.

According to an assay seen by Argus, Obodo has a gravity of 27.65°API and a sulphur content of 0.05 per cent.

It was said that the grade is likely to be priced in line with Nigerian medium sweet Bonga, though details on production levels were not immediately available.

Nigerian independent Continental Oil & Gas will produce Obodo from onshore oil block OML 150 in the Niger Delta region, and state-owned NNPC will market the crude, according to sources.

Data from the Nigerian Upstream Petroleum Regulatory Commission shows that Continental Oil has a stake in OML 150 under a production-sharing contract — typically between the government and a private company.

The newest Nigerian crude will add to a growing supply of medium-sweet grades in the country.

Recall that the Nigerian National Petroleum Company Limited restarted production of similar-quality Utapate in 2024, which followed the launch of Nembe in 2023.

Nigeria’s medium sweets, including Forcados, Escravos, and Bonga, have predominantly found an outlet in Europe — the largest market for Nigerian crude.

Obodo is also expected to find favour with European refineries, where seasonal maintenance is scheduled to wind down by the end of April and early May.

Nigeria’s upstream regulator, NUPRC, in March outlined plans to add 1.07 million barrels per day to the country’s liquids output by December 2026. The plan forecasts an injection of capital into Nigerian oil blocks through joint ventures, production-sharing contracts, and sole risk contracts.

Nigeria has struggled to mobilise upstream investment and has consistently fallen short of less ambitious production growth targets in recent years. The country’s crude production fell by 4.5 per cent on the month to 1.47m b/d in February, according to NUPRC — just under its OPEC+ quota of 1.5m b/d.

Meanwhile, Argus also reported that Nigeria’s 210,000 barrels per day Port Harcourt refinery has been allocated three cargoes of domestic light sweet crude Bonny Light in April-May, according to traders, suggesting that any issues affecting receipts in February and March might have been resolved.

The refinery, which restarted operations late last year following a revamp, has been allocated a 950,000 bl cargo loading over 5-6 April and two 475,000 barrels shipments loading over 22-23 April and 1-2 May, traders said, citing the latest loading programmes. All three cargoes are to be loaded by the refinery’s operator, state-owned NNPC.

Market sources said last month that Port Harcourt’s February and March crude allocations had been cancelled, with one of the sources saying a crude unit at the refinery was not functioning.

This was not confirmed by NNPC. And a source at the company has since told Argus that a 475,000 barrels shipment of Bonny Light had been due to be pumped to Port Harcourt before operations at the grade’s export terminal were briefly disrupted by a fire on the Trans Niger Pipeline last week.

The Renaissance Africa consortium — which recently took over operatorship of the TNP and the Bonny terminal from Shell — said pipeline flows were restored on 19 March.

Port Harcourt — which is designed to run Bonny Light — was originally built as two refineries, and rehabilitation work has only been completed at one 60,000 b/d section.

Total loadings of Bonny Light have been revised to 209,000 b/d for April across seven cargoes and have been set at 202,000 b/d for May across the same number of cargoes.