Nigeria’s rising crude production, export face sinking prices

Nigeria’s crude production and export are rising due to relative calm in the Niger Delta and coming back on stream of Shell’s Bonny Light grade but rising inventories in the United States of America has seen oil prices sink to a 10 week low.

U.S. crude stocks rose by 6.8 million barrels, the Energy Information Administration said on Wednesday. The nation’s crude imports jumped by more than 1 million barrels a day last week, offsetting record activity at American refineries.

The outlook for the global economy darkens as analysts report world trade growth peaked in January, raising concerns that oil demand could slump.

Oil prices plunged on Wednesday after government data showed a big, unexpected jump in stockpiles of U.S. crude, compounding pressure as the outlook for global economic growth darkened and the stock market slumped.

“Prices have been on a downward trend after the release of the American Petroleum Institute (API) data on Tuesday afternoon. The confirmation by the Energy Information Administration drove prices lower as traders continue to monitor the situation between the United States and Turkey,” said Alfonso Esparza, an analyst at Oanda, in a note to Marketwatch.com.

U.S. light crude ended Wednesday’s session down $2.03 a barrel, or 3 percent, at $65.01, its lowest closing prices since June 6. The contract hit an eight-week intraday low at $64.51.

Global benchmark Brent crude oil fell $1.68, or 2.3 percent, at $70.78 by 2:26 p.m. ET, after hitting a four-month low at $70.30.

In Nigeria, total July exports, excluding Akpo, rose to 1.64m barrels per day (b/d) versus revised 1.61m b/d in June. Akpo condensate shipments, rose to 123, 000 b/d versus 95, 000 b/d in June. Combined crude and condensate exports rose to 1.762m b/d from revised 1.688m b/d.

The biggest crude export rises were for Brass, Bonny and Forcados, Bonny Light increased to 127, 000 b/d in July from 87, 000 b/d in June Forcados flows were 204, 000 b/d versus 162, 000. Brass exports rose to 98, 000 b/d versus 32, 000 in June.

Other major flows (in b/d) in July versus June, Agbami: 189, 000 versus 230, 000, Bonga: 123, 000 versus 158, 000, Erha: 123, 000 versus 95, 000, Escravos: 139, 000 versus 190, 000, Usan: 97, 000 versus 67, 000 and Qua Iboe: 215, 000 versus 253, 000.