W. Africa Crude: Tenders Brighten Dull Market

Tender deals helped to liven up a lacklustre West African crude oil market on Thursday, though overall demand remained weak.

 

Indian Oil Corporation bought four cargoes of West African oil, traders said, nibbling at an overhang of unsold September cargoes just a few days before Angola's October loading programme comes to market.

 

Traders were watching to see whether there could be an impact on Chinese imports of West African oil after two huge explosions in the northeast Chinese port city of Tianjin killed at least 50 people, including at least a dozen fire fighters.

 

One trader said there was no immediate impact for oil cargoes already in the area.

 

The new head of the Nigerian National Petroleum Corp said on Thursday that he had started a three-pronged restructuring of the state-owned company that should lead to "a new NNPC".

 

Lower VLCC rates to Asia helped to make shipments more attractive to Asian buyers, though demand was fragile.

 

Hungo was offered at a $3.20 discount to dated Brent.

 

Angola's October export plan is expected early next week.

 

Traders said Qua Iboe was mostly sold out, though Vitol could offer some cargoes.

 

Roughly 20 to 25 September-loading cargoes remained available, including Agbami, Brass River, Erha and Forcados.

 

Forcados was offered at about $1.60 above dated Brent, and Qua Iboe was offered at premiums of $1.40 to $1.70.

 

Argentina's Enarsa has issued a tender for a 950,000 barrel cargo of light West African or North Sea oil.

 

Uruguay's ANCAP bought a local grade of oil rather than West African oil, one trader said.

 

India's IOC bought a cargo of Kole and Brass from Glencore (GLCNF) and a cargo of Forcados and Bonga from Shell, traders said. IOC last week bought 4 million barrels of West African crude, including Brass River and Agbami, from Chevron (CVX) and Qua Iboe and Zafiro from Statoil (STO).

 

Glencore was awarded a tender from Indian refiner MRPL for 1 million barrels of October-loading crude, though it is not known which grade it supplied.