Nigerian crude grades fall on low European demand

Contrary to traders’ expectations, Nigerian crude differentials are beginning to fall slightly as a lack of European demand puts pressure on values, trading sources said Tuesday.

Spot activity on the Nigerian market had been expected to pick up this week as most of the Asian tenders had all been awarded, and the remaining cargoes were seeking homes in Europe, they said.

But the week started off on a slow note, with no trades heard done, even though most traders had been expecting European refiners to start buying more West African grades this week, Platts reported.

However, traders said that for this to happen, differentials for these light sweet grades would have to come down in order to compete with the relatively weaker light sweet Mediterranean and North Sea grades.

“It is now a completely different market… The momentum has gone,” a trader said, referring to the conclusion of Asian tenders, which he said had helped Nigerian crude differentials remain strong.