Nigeria's Crude Oil Exports Rise as Indian Refineries Focus on Non-Russian Grades
- Nigeria's crude oil exports are set to rise in September and October due to increased imports of non-Russian crude by Indian refiners, as reported by Reuters.
- In response to US pressure, Indian Oil Corp and Bharat Petroleum purchased 22 million barrels of non-Russian crude, including U.S. Mars, Brazilian, and Libyan grades.
- These spot purchases represent about 6% of India's May crude processing and are supported by favorable arbitrage economics for Asian refiners.
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Nigeria's crude oil exports are expected to soar in September and October due to increased imports of non-Russian crude by Indian refiners, a Reuters report citing trade sources stated.
Source: Getty Images
Following pressure from the United States to stop buying from Russia, India's largest state refiners, Indian Oil Corp and Bharat Petroleum, purchased at least 22 million barrels of non-Russian crude for delivery in September and October.
After Russia's invasion of Ukraine, Indian state refiners became one of the few buyers of cheaper Russian crude, largely removing themselves from the spot market since 2022.
In response to pressure from US President Donald Trump, they halted Russian acquisitions in late July.
The sources claimed that IOC purchased two million barrels of U.S. Mars crude, two million barrels of Brazilian grades, and an additional one million barrels of Libyan oil on a delivered basis in its most recent tender.
They stated that BP sold the high-sulfur Mars crude shipment for $1.5 to $2 per barrel more than the September Dubai rates.
According to those who spoke to Reuters, the European trader Petraco sold one million barrels of Libyan Sarir and Mesla crude, while Totsa, the trading arm of the company, sold two million barrels of Brazilian Sepia and Sururu crude. Prices for these cargoes were not immediately available.
These agreements follow IOC's purchase of 8 million barrels of crude from the Middle East, the United States, Canada, and Nigeria through tenders last week for September delivery.
Nine million barrels of oil were negotiated for September arrival by BPCL, India's second-largest state refiner, according to a source familiar with the transactions who spoke to Reuters.
The purchases included two million barrels of Nigerian oil, three million barrels of Abu Dhabi Murban, one million barrels of Angola Girassol, and one million barrels of U.S. Mars, the source said.
Businesses often use confidentiality as an excuse to avoid discussing questionable transactions.
Source: Getty Images
The combined September and October spot purchases by the two state refiners amount to about 6% of India's May crude processing, according to calculations by Reuters.
These purchases are supported by improving arbitrage economics for Asian refiners when transporting grades from the Atlantic Basin to Asia, the sources told Reuters.
Dangote Refinery refutes shutdown allegations
Legit.ng reported that recent claims that the Dangote Petroleum Refinery had shut down have been emphatically denied. The company assured Nigerians and market participants that production and supplies are still running smoothly.
The refinery management flatly disputed allegations that its production line was idle or that truck loading operations had been suspended in a statement released by Group Chief Branding and Communications Officer, Anthony Chiejina.
“The Dangote Petroleum Refinery is fully operational. There has been no shutdown, nor has there been any suspension of truck loading activities,” the statement read.
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