In Freight News 05/06/2015
European buyers began showing interest in Nigeria’s June programme, but new sales were slow to filter into the market due to a persistent overhang of Atlantic Basin cargoes.
Traders said there were some positive signs emerging, including a narrowing in the spread between Brent and U.S. WTI crude, which could enable arbitrage to the West.
Brent’s premium to Dubai was also narrowing, which could make Atlantic Basin exports to Asia more viable.
Other unusual buyers were also coming out to take advantage of the drop in premiums, including Canada’s Come-by-Chance refinery.
But with at least 14 million barrels of June-loading Nigerian crude still seeking an outlet, traders said the focus would likely be Europe, where strong refinery margins are expected to spur strong run rates through the summer.
“Europe is the place for the WAF programme,” one trader said. “I expect it’s probably going to be the biggest month there.”
Elsewhere in the market, Indian refineries were in talks with Iraq to buy crude for strategic storage, and OPEC was not expected to cut its output target during its meeting this week.
NIGERIA
* Roughly 15-20 June-loading Nigerian cargoes are still available, along with more than half of July’s 54 cargoes.
* A force majeure on Forcados crude put in place last month was still in effect, Shell said.
* A trader sold a cargo of Antan crude to Europe, but further details were unavailable.
ANGOLA
* Sonangol sold another cargo of Pazflor, but neither the buyer nor premium were immediately clear.
* Of the primary grades, only Cabinda had sold out for July-loading.
* Fewer than 20 cargoes are still for sale for July loading.
TENDERS
* Indonesia’s Pertamina issued a tender to buy crude oil for August delivery. In its tender for July crude, it took two cargoes of Qua Iboe from Shell as well as a cargo of Escravos from Chevron.
