The Nigerian National Petroleum Corporation has said the demand for the nation’s crude oil outstrips the current supply.
Last year, Nigeria saw a resurgence of militant attacks in the Niger Delta that caused the nation’s oil production to plummet to a near 30-year low of 1.4 million barrels per day from about 2.2 million bpd.
“As we speak now, even the demand for Nigeria’s crude oil is over-subscribed. We have more buyers demanding for our crude oil than what we can supply to them,” the Group General Manager, Group Public Affairs Division, Mr. Ndu Ughamadu said
Ughamadu noted that The Netherlands, one of the European buyers of Nigerian crude, was at the corporation’s headquarters a few weeks ago in connection with petroleum resources.
“They want to collaborate with the NNPC towards utilising petroleum products for the production of animal feeds. So, more innovations will come up towards utilising the raw materials,” he said when asked about the implications of the growing electric car adoption for Nigeria’s oil exports.
Meanwhile, Reuters reported that spot trading of West African crude was limited on Wednesday as fresh loadings competed with offers from storage and leftovers from the October loading plan.
The force majeure on Bonny Light, Nigeria’s main export crude, remained in place, and no November programme appeared for it or for Erha.
Traders were quoted to have said that there was no clear sign that the force majeure would be lifted in the coming days.
A cargo of Brass River crude was sold from the November loading plan, which included four cargoes for a total of 115,000 bpd.
Roughly 10 to 12 cargoes remained from the October plan, half of them Forcados, with traders saying offers of close to $2 per barrel above dated Brent had dented demand for it.
Thus far, the November loading plan has 45 cargoes with a total of 1.3 million bpd, with Bonny Light, Erha and several smaller grades still pending.
The Group General Manager, Crude Oil Marketing Division, NNPC, Mr. Mele Kyari, told S&P Global Platts on Wednesday that he expected the force majeure on Bonny Light crude to be lifted “very soon.”
“I cannot give you an immediate timeframe but I know that it will be very soon, as soon as repair works are completed,” Kyari said in an interview on the sidelines of the APPEC conference in Singapore.
Last week, the Organisation of Petroleum Exporting Countries endorsed Nigeria’s position that the exemption granted it at the November 2016 ministerial conference and extended in May this year should be sustained until it stabilised its crude oil production.
Nigeria had argued that although its production recovery efforts had made some appreciable progress since October last year, it was not yet out of the woods.
The Minister of State for Petroleum Resources, Dr. Ibe Kachikwu, told the meeting that even though Nigeria hit 1.802 million bpd in August, that was not enough justification for a call by some countries for it to be brought into the fold.
According to him, Nigeria will be prepared to cap its crude production when it has stabilised at 1.8 million bpd.