NIGERIA’S plan to increase its crude oil export in October may suffer setback as European refinery maintenance is expected to peak in that month, limiting the amount of crude oil they consume.
Europe, which is Nigeria’s biggest regional market, has increased its import of Nigerian crude in recent times, partly offsetting the county’s loss of the United States as a key buyer. In 2014, 45 per cent of Nigerian crude exports went to Europe, according to the US Energy Information Administration.
Nigeria plans to export a total of at least 2.04 million barrels per day of crude oil in October, the highest level this year, according to provisional loading programmes.
The exports, which will load on 68 cargoes, could increase as the programmes for at least two grades were still pending, according to Reuters.
The amount compares with planned September exports of just below two million bpd, and is the highest total since January, when the country issued an initial programme of 62.97 million bpd, or 2.03 million bpd.
Four regions namely, Europe, Asia and Far East, South America and Africa are the major destinations of Nigerian crude and condensate export, according to the Nigerian National Petroleum Corporation.
But weakening demand in Asia, where Chinese refineries are cutting runs and that country’s shaky economic growth is roiling international commodity markets, has already begun to pressure differentials to dated Brent for West African crude grades.
Additionally, though crude oil futures were rallying on Wednesday, the Brent benchmark on which Nigerian export prices are based was still close to six-and-a-half year lows.
For the first time in six and a half years, the global oil benchmark Brent crude on Monday traded around $43 per barrel.
The further slide in oil prices followed concerns about slowing Chinese demand, even as Iran and the US look set to raise oil production.
Chinese stock markets on Monday suffered their biggest one-day decline since the global financial crisis, exacerbating worries over the outlook for global oil demand.