60 Nigerian Crude Oil Cargoes Remain Unsold
By Adedapo Adesanya
At least 60 Nigerian crude oil cargoes have failed to find buyers despite the reduction of the official selling prices (OSP) by the Nigerian National Petroleum Corporation (NNPC), a report by Reuters has said.
The 60 cargoes were unsold were for April and May even after cargoes of Qua Iboe and Bonny Light crude continued to be offered at a discount of $3 on the dated Brent price.
Business Post had earlier reported that the NNPC in March cut its April official selling prices for Bonny Light and Qua Iboe by $5 per barrel to dated Brent minus $3.29 and minus $3.10 per barrel, respectively.
This is coming at a time when there is more pressure on crude prices due to almost 65 percent drop in demand despite decisions by members of the Organisation of the Petroleum Exporting Countries (OPEC) and some other oil producers to cut supply by 10 percent globally of which Nigeria pledged to cut around 400,000 barrels per day.
Following this, the country had expressed optimism that crude prices may rebound by $15 per barrel but with latest rounds of developments, the market had continued to fall in the face of an oil glut.
Saudi Arabia on Monday projected that effective global oil supply cut may reach about 19.5 million barrels per day, taking into account the reduction pact agreed by OPEC and its allies but this had done nothing to save the market.
Last month, the Federal Government set a $30 barrel benchmark for the reviewed budget of 2020 but prices had fallen as far to $27 per barrel, compromising any optimism in funding the budget in the face of a deadly outbreak of coronavirus in the country.
On Tuesday, the International Monetary Fund (IMF) said that the global economy was on course to contract by 3 percent in 2020, due to the coronavirus outbreak and the Great Lockdown which will plunge many economies into recession.
Nigeria is expected to contract by 3.4 percent this year, but projected to rebound as much as 2.4 percent in 2021.