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INTERESTED IN NIGERIA CRUDE OIL
OIL MARKETS

OIL MARKETS

This blog is an indepth  and frequently critical analysis of topical issues in the global oil markets  as they relate to Nigeria

 

 An analysis on global oil market and how they effect Nigeria's economic and financial well being. Nigeria's economy is inextricably linked to these markets and the decisions key actors take to safeguard  and promote their own economic objectives. Nigeria principally seeks to excersize its own influence on the global stage through its membership of OPEC. But just how effective is OPEC? Do the key actors share similar policy objectives or political alignments with Nigeria. Has OPEC+ (inclusion of Russia) altered the organisations focus?

The blog also analyses the broader issues in respect of fossil fuels, geopolitical events and their ramifications for Nigeria. We critique the Nigerian government policy decision making and other legislation and the effect it has on Nigeria's prosperity

Friday, 28 February 2020 20:46

NNPC FAIL NIGERIA AGAIN,TIME TO HEDGE OIL

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There is reason for Nigerians to worry and it is not only the arrival of COVID-19. Oil price benchmarks are in freefall, crashing through resistance levels as if they were none existent. This week has seen Oil fall to its lowest price levels since July 2017 and barring a miraculous cure for the COVID-19, it is difficult to see what an OPEC+ are able to do to arrest this downward spiral. We may see Brent below $45 as Libya gets back on stream. Brent crude, the global oil benchmark which is used by Nigeria as the marker for all the crude oil they sell has plummeted. It fell as much as 4.2% today, briefly breaking below $50 a barrel, which is a level not seen since 2017. It eventually lost 3.27% or $1.66 to finish the day on the ICE at $50.07 which puts it on track for its worst week in four years. WTI crude ended up at $45.31, a decline of 3.78% on previous days trading. About 12 years ago in the wake of the recession which caused demand for crude oil to shrink in late 2008, with oil prices collapsing from $147 to $32, I put to…
Thursday, 27 February 2020 15:45

OIL PRICES SLUMP AS MARKET LOOKS TO OPEC

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Oil price benchmarks suffered further deterioration as the COVID-19 instigated assault weighed heavily on global markets. Oil prices slumped yet again on Thursday, for the fifth straight day to their lowest since January 2019. The coronavirus epidemic's sporadic global outbreak has intensified fears of a pandemic that will lead to a significant economic downturn and a collapse in the call for crude oil On thursday WTI was trading at $46.52 a down 4.54% or $2.21 on previous session whilst Dated Brent traded on the ICE at $50.64, down 4.11% and close to BREACHING the $50.50 resistance point. The fundamentals endorsed by the fact that For the first time since the start of the coronavirus outbreak, it is reported by the World Health Organisation that, the number of new infections outside China exceed those within. An anticipated reduction in demand for transport fuels and the fear of economic slowdown in large economies such as Japan, South Korea and Italy, countries that have been infected by COVID-19 have underpinned the slump in oil prices in a market that was already oversupplied. Not even the bullish numbers emanating from the EIA could buoy the market. U.S. crude oil stockpiles increased by 452,000 barrels…
Tuesday, 25 February 2020 17:13

NIGERIAS APRIL CRUDE PROGRAM EMERGES

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COVID-19 and the consequent demand destruction is set to affect Nigerian crude as there is simply far too much oil in the market. This is making it difficult to shift cargoes and exerting downward pressure on price differentials. The falling crude price has already caused the IMF to revise downward Nigeria GDP growth. The last time oil prices collapsed it sent the country in to recession in 2014, the economy is only just emerging from that recession. Nigeria's preliminary loading programmes for April continued to emerge, after differentials were heavily weighed down in the last trading cycle by sluggish demand in both Eastern and Western markets. A handful of Nigerian programmes were still outstanding on Monday while Taiwan took some west African crude.Nigeria’s Bonga programme had yet to emerge, lagging behind other major grades. Schedules for a few small streams were also missing, such as Abo, Pennington and Okono. Taiwan’s CPC reportedly took a cargo of Forcados in its latest buy tender for April arrival. * Nigeria will export seven cargoes of Bonny Light in April, with volumes set to fall to 228,000 barrels per day (bpd) from 245,000 bpd in March. * Exports of Forcados were set at nine…
Friday, 21 February 2020 19:54

CRUDE OIL IMPORTS CREATE CHINESE PUZZLE

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COVID19 THE CHINESE PUZZLE It is by definition complex, intricate, requires ingenuity and is perplexing. Out of a clear blue sky just as market analysts had snugly settled down with their forecast outlook for 2020, it emerged without warning, a shock that the market is still yet to fully comprehend. Despite the initial slump in global oil benchmarks the price of Brent rebounded by over 10% last week. This week ending, West Texas Intermediate crude for April delivery CLJ20, -1.99% on the New York Mercantile Exchange fell $1.13, or 2.1%, to $52.75 a barrel, while April Brent crude BRNJ20, -2.23% lost $1.37, or 2.3%, to trade at $57.94 a barrel on ICE Futures Europe. Coronavirus fears returned to the market as the pervading sentiment seems to be that the virus still has a course to run with no clear sign it has peaked. With Refiners in China reported as processing 25% below seasonal averages and an estimated reduction in transport fuel consumption of 30-40% the logical expectation would be that oil prices continued on their downward spiral. Apple Inc. have issued what is essentially an impartial prognosis on the Chinese economy. A warning that would normally be regarded as a…
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