Nigerian Oil Futures Bullish as Bonny Light Strikes $66

By Adedapo Adesanya 

Nigerian oil futures traded higher on the first day of the week on the back of the trade deal between the United States and China, which is expected to further boost flows between the world’s top two global economies.

Nigeria has three major futures on the international market as all three traded above $65 per barrel on Monday. The Bonny Light, which is in high demand specifically by American and European refineries, was trading up by 46 cents equivalent to 0.70 percent at $66.07 per barrel as at Monday night.

The Brass River and Qua Iboe, both sweet medium light crude, also traded up, as they crossed the $68 mark. The Brass River rose up by 43 cents or 0.63 percent to trade at $68.25 per barrel, while the Qua Iboe was also up by 43 cents or 0.63 percent to trade at $68.50 per barrel on Monday.

The United States and China eased over 18 months trade tensions on Friday with the announcement of a phase one agreement that reduces some U.S. tariffs in exchange for what analysts say would see the Chinese purchases of American farm products and other consumer goods.

The Friday agreement put a stop to the planned additional tariffs on Chinese goods worth $160 billion that the United States was set to impose on its trade rival on Sunday (December 15).

Other key crude futures also made gains on the first day of the week as the international benchmark, the Brent crude oil futures rose 13 cents or 0.2 percent to $65.35 per barrel, while the US West Texas Intermediate (WTI) crude rose 15 cents to settle near a three-month high of $60.22 per barrel.

Prices also drew support on Monday from Chinese data showing industrial output and retail sales growth accelerating more than expected in November as industrial production rose 6.2 percent year-on-year in November, official data from the China National Bureau of Statistics showed on Sunday.

Meanwhile, analysts believe oil prices are expected to keep up the trend due to efforts by the Organization of the Petroleum Exporting Countries (OPEC) and allies including Russia to cut production.

The alliance, known as OPEC+, has agreed to lower supply a further 500,000 barrels per day as of January 1, which could boost oil prices as well as stop an expected oil glut next year.