LONDON: West Africa crude trading diverged on Wednesday, as Angolan selling and differentials versus dated Brent fared better than Nigerian grades. Traders said steady buying from Chinese and European refiners who prefer Angolan grades is helping to support the differentials and clear out the May programme, whereas Nigerian cargoes are struggling to sell.
"Angola cargoes are moving quite fast," one trader said. "But for Nigeria, we have seen even some March cargoes unsold." High refining margins have led some, including India's Essar Oil, to delay maintenance work. This could boost demand for crude. Despite this, traders said even differentials for Angolan will face downward pressure, particularly given that sellers started the May programme by offering higher levels compared with April.
"Offers were high since the start of the May programme," another trader said. "Levels will need to come off a bit in order for buyers to jump on these cargoes." At the same time, the steady stream of tenders from India that doubled the country's West African crude import plans for April loading have begun to quiet. A fresh tender from India's IOC, the lead buyer of April-loading WAF for India, did not seek any West African grades.
There was also tentative optimism regarding stability in Nigeria's exports, as a hotly contested election ended peacefully and with a clear winner, the first time in the country's history that a sitting leader has been removed via the ballot box.
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