LONDON: West African crude was little changed on Wednesday, but selling into Asia could become more difficult if expected cuts to Saudi Arabian official selling prices materialise later this week.
Traders said a reported attack on a vessel in the vicinity of the Qua Iboe terminal off the coast of Nigeria could also make loading Nigeria's largest crude stream more expensive due to insurance and security costs. Shipping and crude sources said the attack on the Greek-flagged Kalamos left one crew member dead, but neither the vessel manager, the charterer listed for the ship, India's BPCL, nor the Nigerian government returned calls for comment.
Sources said the vessel had not yet loaded a cargo of Qua.
While there was no clear impact on differentials for Nigerian grades, traders said that if the reports are true, the cost of getting vessels in and out of the country would rise, making its crude exports less competitive in an already oversupplied market.
"Security might have to be tightened, which would likely be passed to a consumer," one trader said. Differentials to dated Brent have risen in recent weeks for west African grades, but they remain near 5-1/2 year lows hit at the end of 2014 as sellers fought for market share, mostly with Middle Eastern suppliers. Later this week, top oil exporter Saudi Arabia is expected to cut March prices for the crude it sells to Asia, with traders anticipating cuts from $1 to $2 per barrel in official selling prices.
Sales of Angolan crude continued, with roughly 10 March-loading cargoes left for sale.
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