LONDON: West African crude differentials to dated Brent came under further pressure on Friday as Nigeria's May export programme showed mostly stable volumes from the previous month.
Traders said the new offers, joining the 20-odd cargoes still available from the April programme, are likely to make buyers more reluctant to pay the prices sellers want.
Differentials hit eight-month highs in recent weeks on the back of strong demand via tenders from Indian refineries.
There are two more such tenders, from HPCL and BPCL, pending now, and the biggest buyer of late, IOC, awarded another tender earlier this week. Nigeria's state oil company raised the April official selling price (OSP) for Qua Iboe and Bonny Light crude oil to dated Brent plus $1.25 and $1.15 per barrel respectively, reflecting the stronger market. The March price was dated Brent plus 82 cents for both grades. But traders said such prices are no longer sustainable.
"The offers are too high," one said. "WAF is too expensive." Despite this, traders said sellers of Angolan crude are increasing the prices they want for May-loading cargoes because of what they view as strong demand.
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