Crude oil market situation report

Spot trade was limited as buyers expected falling differentials and sellers awaited the results of the latest tender from India’s IOC and the latest loading plans from Angola’s Sonangol.

NIGERIA

* Total was offering 2 million barrels of Escravos, delivered to Singapore at $2.45 above dated Brent, from storage in South Africa, traders said.

* Vitol had offered several cargoes of Qua Iboe from storage in recent weeks, selling some of it to Taiwan’s CPC, while traders said Mercuria had also offered recently from storage.

* The offers from storage, spurred in part by flatter contango, were weighing on near-term prices and slowing fresh spot sales. High freight was adding further downward pressure.

* At least 20 cargoes from the April programme had yet to trade.

* Some March-loading Agbami and Akpo were also still available, which was weighing on prices for lighter grades.

* Monthly discussions between producers and state-owned NNPC on crude allocations were delayed to March 21-22, in part due to the Abuja airport closure. May loading programmes were not expected until the end of next week.

* A group of Nigerian contractors met executives from Italian oil major ENI to discuss unpaid wages, the latest sign of tension that is still rife across the Delta oil producing region.

* Venezuelan state oil company PDVSA has offered Russian counterpart Rosneft a stake in a joint venture in the country’s Orinoco Belt extra-heavy crude area, five industry sources said, in a sign of the Latin American nation’s dire economic situation and Moscow’s growing muscle there.

* Oil exports from Iraq’s southern terminals have edged lower so far in March, according to loading data and an industry source, although not as much as expected, potentially raising questions over the country’s compliance with OPEC production cuts.