Bad News For Nigeria As Crude Price Slips To $65, China Cuts Imports
Things are not looking good for Nigeria’s oil revenue prospects.
First, crude oil prices are coming down from as high as $86 in early October to just about $65 per barrel on Wednesday.
Brent crude, the type that Nigeria majorly exports was down 0.35% at $65.24 per barrel on Wednesday.
Brent crude price had tanked 6.8% on Tuesday and set an eight-month trough of $64.61.
To make matters worse, one of Nigeria’s biggest crude importers, China is planning to cut its imports of West African oil to the lowest in seven months in November.
This is due to the higher cost of shipments, while South Korean imports from West Africa will reach an 11-year high as U.S. sanctions hit Iranian crude supplies.
According to November loading prorgramme published by Reuters on Wednesday, West African loadings to Asia will fall to about 2.33 million barrels per day (bpd) this month, equivalent to 70% of total exports from Angola, Nigeria, Republic of Congo, Ghana and Equatorial Guinea.
This is based on Reuters calculations, shipping brokers and Refinitiv Eikon data. This compares to October's 2.52 million bpd, or 75% of total regional exports.
“Demand from Asian refiners for Nigerian and even Angolan crude, which tends to be favoured by Chinese buyers, sagged over the course of October and early November, as higher shipping costs made the trip uneconomical,” said the Reuters report.
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