Nigeria’s oil revenue may drop as U.S. cuts import by 64 per cent

No Comments » April 13th, 2012 posted by // Categories: Nigeriawatch



Nigeria’s oil revenue may drop as U.S. cuts import by 64 per cent



CRUDE oil imports into the United States from Nigeria have continued to decline due to idled refineries and more use of domestic crude, a report from the Energy Information Administration (EIA) has stated.

The report noted that there was a sharp decline in the quantity of crude oil imported from Nigeria since January this year, when compared to the same period last year.

The preliminary weekly data indicated the trend at which Nigerian oil exports to U.S. continued to decrease between February and March 2012, with March export averaging just 301, 000 barrels of oil per day (bbl/d).

“In January, the United States imported 449,000 barrels of Nigerian crude oil per day, a 54 per cent decrease from the same time last year, making it the largest monthly decline since 2002.

“One third of this decline was as a result of two idled Philadelphia-area refineries, which were ConocoPhillips’ Trainer refinery, idled in September 2011 and Sunoco’s Marcus Hook refinery, idled in December 2011. The two  refineries which imported a combined 173 thousand bbl/d of Nigerian crude in January 2011.

“Most of the remaining decrease in Nigerian oil imports were caused by several Gulf Coast refiners, which reduced imports in favour of domestically-produced crude,” IEA said.

The agency said declines were attributed to the quality of Nigerian crude, as many of the refiners preferred to use domestic crude oil like West Texas Intermediate, Bakken and Eagle Ford that were cheaper.

“Given the growing production from the Bakken and Eagle Ford formations and associated transportation constraints, these inland crudes have been selling at a discount to waterborne crudes on the Gulf Coast, providing refiners in that area further incentive to switch from imported crude to inland and domestically produced crude, when available,” the agency said in a statement.

Meanwhile, Nigeria’s oil export in May could outshoot the previous loadings, making a record of a 10-month high, as it plans to load about 69.3 million barrels in 75 oil cargoes, according to the loading plans.

The programme showed a total of 75 cargoes of 18 main grades, amounting to 69.3 million barrels or 2.24 million barrels a day, the highest since July last year.

The country plans to export five 950,000-barrel cargoes of the new Usan grade in May, up from three, as production at the field, which has the capacity to pump 180,000 barrels a day, started in late February, according to Total SA, the operator of the project.

Nigeria will also ship 12 cargoes of Qua Iboe, eight Agbami, seven Forcados, five Bonny Light, five Akpo, five Bonga, four Erha, four Brass River, four Escravos, three Amenam, three Yoho, two EA, two Antan, two Okwori, two Okono, one Pennington and one Abo, according to the schedule.

Shipments are typically of 950,000 to one million barrels each.

Author of this article: By Obiora Aduba
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