NNPC SLASH PRICE OF NIGERIAN CRUDE TO ALEAST $I A BARREL
The management of The
Nigeria National Petroleum Corporation, Thursday, slashed the official selling
price of Nigeria’s crude oil grades as parts of strategy to make Nigeria crude
oil attractive to buyers and to help it regain its share of the global crude
oil market. According to a report by Bloomberg Energy, the NNPC cut the price
of every type of crude it sells in an effort to regain share of the global oil
market at a time when there is a huge glut of cargoes.
The report disclosed that the NNPC lowered by at least $1 a barrel, its official selling prices (OSP), for 20 out of 26 oil grades monitored by Bloomberg, according to pricing lists. It noted that Qua Iboe, Nigeria’s largest export crude oil under normal circumstances, was reduced by the most since 2014. Specifically, it explained that the NNPC cut the selling price of Qua Iboe for November to a 17 cent premium to the benchmark Dated Brent, according to the price list, from $1.07, while it reduced the price of Bonny Light to a seven cent premium and Forcados to a 41 cent discount to Dated Brent. Brent crude futures, the report said, slumped as much as 2.7 per cent to $51.27 a barrel, the largest intraday decline since September 27. They were down 2.2 per cent at $51.51 at 3:49 p.m. on the ICE Futures Europe exchange in London. Mele Kyari, Group General Manager, Crude Oil Marketing Division of the NNPC, stated that the price reductions are due to a huge cargo overhang as the country attempts to regain market share. Kyari disclosed that five companies that market the nation’s crude oil had raised the issue of high official selling prices, adding, however, that the decision to cut the price was unrelated to those complaints. The Bloomberg report stated that like every other crude oil producer country, Nigeria is grappling with prices that are less than half what they were in July 2014.
The report disclosed that the NNPC lowered by at least $1 a barrel, its official selling prices (OSP), for 20 out of 26 oil grades monitored by Bloomberg, according to pricing lists. It noted that Qua Iboe, Nigeria’s largest export crude oil under normal circumstances, was reduced by the most since 2014. Specifically, it explained that the NNPC cut the selling price of Qua Iboe for November to a 17 cent premium to the benchmark Dated Brent, according to the price list, from $1.07, while it reduced the price of Bonny Light to a seven cent premium and Forcados to a 41 cent discount to Dated Brent. Brent crude futures, the report said, slumped as much as 2.7 per cent to $51.27 a barrel, the largest intraday decline since September 27. They were down 2.2 per cent at $51.51 at 3:49 p.m. on the ICE Futures Europe exchange in London. Mele Kyari, Group General Manager, Crude Oil Marketing Division of the NNPC, stated that the price reductions are due to a huge cargo overhang as the country attempts to regain market share. Kyari disclosed that five companies that market the nation’s crude oil had raised the issue of high official selling prices, adding, however, that the decision to cut the price was unrelated to those complaints. The Bloomberg report stated that like every other crude oil producer country, Nigeria is grappling with prices that are less than half what they were in July 2014.
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