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Traders operating in the oil markets that deal with Nigerian crude have announced that at least 21 Nigerian crude cargoes, 31 percent of output, which will be ready for loading in February, still remain unsold. The drop in sales is caused by a lack of demand due to increasing shale oil output from the US, and a reduction in refining margins from Europe.
The loading programs show the schedules of crude shipments that have been drawn up by field operators, and are released in advance for each month to help traders plan their supply, buying, and selling activities.
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The 21 unsold shipments waiting for export next month consist of: six loads of Qua Iboe (Nigeria’s benchmark grade crude oil), four loads of Brass, three of Forcados, two of Bonny Light, two of Erha, another two of Usan grade crude, and then one load each of Abo, and Yoho crude oil.
As the US begins to produce more and more tight oil from shale formations its demand for foreign supplies continues to fall; imports of Nigerian crude are expected to fall to their lowest in 27 years. According to Bloomberg, in order to avoid over supplying the market or being left with unsold crude loads, Nigeria, Africa’s largest oil producer, plans to cut back its exports in February to 67 cargoes, around 2.19 million barrels a day, compared with 75 cargoes that it has produce for export this month.
By. Joao Peixe of Oilprice.com
Joao is a writer for Oilprice.com