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Nairaland Forum / Nairaland / General / Politics / US Cuts Demand For Nigerian Crude (10030 Views)
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US Cuts Demand For Nigerian Crude by texazzpete(m): 7:52pm On May 27, 2012 |
Nigeria is losing the United States as its biggest oil customer amid surging output and refinery closures in North America, prompting Africa’s top producer to ship its crude twice the distance to Asia. U.S purchases of Nigerian crude fell to a five-year low in February, knocking the OPEC member to sixth from fifth among suppliers to the world’s largest oil consumer, Energy Department data show, Bloomberg reports. To offset the trend, the country is sending cargoes to Asia, where refiners are set to increase imports in June to the highest in a year, according to data compiled by Bloomberg. Qua Iboe, a light oil that’s Nigeria’s most abundant grade, slumped to an 18-month low in April as buyers in Asia that typically use cheaper, heavier crudes, demanded price cuts to cover the cost of shipping it halfway around the world. The voyage from the Bonny Terminal in Nigeria to Tianjin, China, is 12,172 miles, compared with 5,847 miles to New York Harbour. “It’s a very plausible scenario that one day the U.S won’t need to import crude oil from Nigeria,” said Olivier Jakob, managing director at Petromatrix, a Zug, Switzerland-based consultant. “The U.S is awash with light crude. Nigerian crude may need to be priced at a discount to go to new markets in Asia.” Boosted by drilling in shale-rock formations such as North Dakota’s Bakken and Texas’ Eagle Ford, crude production in the U.S rose to 6.24 million barrels a day in the week ended May 18, the highest level since 1999, government data show. The country’s Nigerian oil imports fell to 352,000 barrels a day in February, about a third of the amount purchased a year earlier, according to the Energy Department. Refiners are closing plants on the U.S East Coast, the main destination for Nigerian exports, amid falling returns. Sunoco idled the 194,000-barrel-a-day Marcus Hook plant in Pennsylvania on December 1. The company also said it would decide by July whether to halt production at its 355,000-barrel-a-day Philadelphia plant. ConocoPhillips stopped its 190,000-barrel-a-day Trainer, Pa., site on September 30. The facilities together account for half of East Coast processing capacity. “The U.S. is losing its position as a lead buyer of Nigerian crude,” said David Wech, an analyst at JBC Energy in Vienna. The slide in Nigeria’s status as a U.S. supplier marks the decline of a relationship that dates from 1961, when Texaco Overseas began operations in the African producer. The country kept up exports to the U.S even as attacks by militant groups in the Niger Delta cut output by more than 28 per cent from 2006 to 2009. Reduced U.S demand still hasn’t curtailed Nigeria’s exports. Crude and condensate sales are on course to rise to 2.27 million barrels a day next month, close to their highest level in 10 months, according to loading programs obtained by Bloomberg News. Demand for Nigeria’s oil may also be supported by South Africa as it seeks replacement sources amid international sanctions against Iran. http://www.punchng.com/news/u-s-cuts-demand-for-nigerias-crude/ 1 Like |
Re: US Cuts Demand For Nigerian Crude by texazzpete(m): 7:54pm On May 27, 2012 |
Also of note...many refineries are closing down in the US because of low profit margins or sustained losses. I remember telling many of the folks on NL here that the stories from the FG that Nigeria would soon be awash with companies desperate to build refineries were just plain lies! Not many believed me. Na wa! |
Re: US Cuts Demand For Nigerian Crude by dasparrow: 8:00pm On May 27, 2012 |
texazzpete: Also of note...many refineries are closing down in the US because of low profit margins or sustained losses. Aha! Anyway, now is the time for Nigeria to invest in other sectors. We have been depending on oil for too long. If oil should dry up suddenly today, what is Nigeria going to do? |
Re: US Cuts Demand For Nigerian Crude by hakanai(m): 8:14pm On May 27, 2012 |
Apart form the USA internal dimension,The issue of insecurity around oil producing countries and route.The USA is turning to the Americas,especially Canada for oil.Since Canada is expanding her ability to explore and export her tar-sand oil to her neighbor USA.The ease,security and proximity will go along away in changing the equation to travel to trouble zones(middle east,Africa etc) for oil. |
Re: US Cuts Demand For Nigerian Crude by manny4life(m): 8:17pm On May 27, 2012 |
It's only a matter of time, when oil falls flat and budget cannot be met, like they say, by fire or by force. |
Re: US Cuts Demand For Nigerian Crude by MrGlobe(m): 8:35pm On May 27, 2012 |
Wahala dey oh. Everything in Nigeria is falling apart. GEJ is heavy badluck to the country. Very soon I will what the Niger delta people claim to fame will be. Why not divide this nation let everybody manage their resources |
Re: US Cuts Demand For Nigerian Crude by Nobody: 9:25pm On May 27, 2012 |
texazzpete: Also of note...many refineries are closing down in the US because of low profit margins or sustained losses. did you expect the teeny boppers and brainless govt solar energy salesmen /spokesmen to believe you? seriously ? |
Re: US Cuts Demand For Nigerian Crude by Beaf: 9:38pm On May 27, 2012 |
Its no surprise when Nigerian "engineers" cannot even scale up simple solar processes (they know themselves). It is good for America to divest from our oil business for a thousand and one reasons from our attainning a truly federal state to diversifying away from oil. Maybe all awuf takers will now begin to sit up and rethink our entire Abuja awuf culture. |
Re: US Cuts Demand For Nigerian Crude by Nobody: 10:20pm On May 27, 2012 |
who invited the afropseudoscientists /pseudo entrepreneurs /full time noisemakers to the discussions of professionals ? |
Re: US Cuts Demand For Nigerian Crude by ektbear: 10:54pm On May 27, 2012 |
oyb: who invited the afropseudoscientists /pseudo entrepreneurs /full time noisemakers to the discussions of professionals ? An excellent question. Anyway, interesting post texazzpete. |
Re: US Cuts Demand For Nigerian Crude by Beaf: 11:01pm On May 27, 2012 |
oyb: who invited the afropseudoscientists /pseudo entrepreneurs /full time noisemakers to the discussions of professionals ? "Professionals" and hingineerss with oluwole degress that can't scale up the simplest system. Lol! Next thing rewires and trap setters will begin to get mouthy! |
Re: US Cuts Demand For Nigerian Crude by Nobody: 11:03pm On May 27, 2012 |
i was reading about fracking in the economist not exactly the same article, but. . . http://www.economist.com/node/21540256 SHALE gas has turned the American energy market on its head. Production has soared twelvefold since 2000, to 4.9 trillion cubic feet, or a quarter of the country’s total gas output. By 2035 the proportion could rise to half. As the shale gas flows, prices have come crashing down. Not long ago, America depended on imports of liquefied natural gas. Now it is likely to become a gas exporter. These benefits have not gone unnoticed in Europe. long and short of it, there seems to be a serious abundance of gas as a source of energy who knows we may even see a preponderance of gas powered cars our bigger customers are going out the window. . . |
Re: US Cuts Demand For Nigerian Crude by Beaf: 11:06pm On May 27, 2012 |
^ Ayam preparing to disgrace some pipo! Fake hingineers dem! Una no go beg me?! ![]() ![]() ![]() |
Re: US Cuts Demand For Nigerian Crude by ektbear: 11:24pm On May 27, 2012 |
oyb: Interesting article. I wouldn't be too worried about the long-term prices of oil and gas, though. China and India are not industrialized yet. And represent, what, 40% of humanity? So demand should grow enough over the next 20, 30 years for prices not to fall too much. It will be interesting to see how things turn out, though. |
Re: US Cuts Demand For Nigerian Crude by AjanleKoko: 11:39pm On May 27, 2012 |
oyb: who invited the afropseudoscientists /pseudo entrepreneurs /full time noisemakers to the discussions of professionals ? ![]() ![]() ![]() ![]() ![]() Anyway, @topic. It doesn't matter much. China, and to some extent India, is desperate for cheaper crude anyways. So demand will be stable I guess, over the medium term. |
Re: US Cuts Demand For Nigerian Crude by CyberG: 1:08am On May 28, 2012 |
^^ Both of you are missing something: the exports to Asia would be at reduced profit to compensate for the longer distance required to transport the oil. Plus, the Chinese are guaranteed to want anything and everything for rock-bottom cheap prices! |
Re: US Cuts Demand For Nigerian Crude by ektbear: 1:11am On May 28, 2012 |
CyberG: ^^ Both of you are missing something: the exports to Asia would be at reduced profit to compensate for the longer distance required to transport the oil. Plus, the Chinese are guaranteed to want anything and everything for rock-bottom cheap prices! First point, agreed. More profitable for Nigeria to ship to the Eastern US rather than China. Alas. |
Re: US Cuts Demand For Nigerian Crude by tpia5: 1:14am On May 28, 2012 |
Beaf: ^ mr lagosuuu, you're at it again? |
Re: US Cuts Demand For Nigerian Crude by AjanleKoko: 1:19am On May 28, 2012 |
CyberG: ^^ Both of you are missing something: the exports to Asia would be at reduced profit to compensate for the longer distance required to transport the oil. Plus, the Chinese are guaranteed to want anything and everything for rock-bottom cheap prices! True that. But not pricing. Pricing will still be at OPEC levels. Just the costs of transportation would be more expensive. It may well even out in the end, as China's energy appetite continues to soar. Asia already outstrips the West in energy demands. Don't forget the Yar'Adua government brought in the Chinese to negotiate for some of the JV stakes. They offered something like $50bn to buy out the IOCs. It will be a while before the party ends. |
Re: US Cuts Demand For Nigerian Crude by Yeske2(m): 1:22am On May 28, 2012 |
I hope our dumb-a$$ president and his retinue of sycophants read the handwriting on the wall before market fall on top our head. |
Re: US Cuts Demand For Nigerian Crude by Korrection(m): 9:05am On May 28, 2012 |
The US can never do without our oil....of course you guys know what our oil has that other countrys crude dont have...dem go still come back for it....na just govt dey kill us if not other countries for dey beg us for things |
Re: US Cuts Demand For Nigerian Crude by Nobody: 10:13am On May 28, 2012 |
Ain't surprised. After all, they are now in control of Libya oil well. |
Re: US Cuts Demand For Nigerian Crude by juman(m): 10:30am On May 28, 2012 |
Good news. |
Re: US Cuts Demand For Nigerian Crude by Ogblikwe(m): 10:34am On May 28, 2012 |
Too much over reliance on oil revenue. The State ought to have by now developed other viable income generating sectors comparable or even surpassing the oil revenue. |
Re: US Cuts Demand For Nigerian Crude by cashcpt(m): 10:36am On May 28, 2012 |
When America wants to arrange regime change or total change in the power dynamics of a country they start by reducing or stopping trade with that country it happened in Gadaffi's Libya and Saddam's Iraq. Their State Department then goes on to castigate everything abt the target country in a similar format to d official statements dat were released just last week where Jonathan the Ministers the Nigeria Police EFCC and Legislators were indicted for gross corruption amidst other sins. Nigeria is over you guys can forget abt 2015 the violent and messy disintegration starts in d 2nd half of 2012. There wld be much shedding of blood |
Re: US Cuts Demand For Nigerian Crude by Fxmarket: 10:37am On May 28, 2012 |
Beaf: ![]() ![]() ![]() ![]() ![]() ![]() |
Re: US Cuts Demand For Nigerian Crude by daywatcher: 10:39am On May 28, 2012 |
Would it affect the masses if all countries stopped buying oil from Nigeria? |
Re: US Cuts Demand For Nigerian Crude by Nobody: 10:39am On May 28, 2012 |
Yet another reason why we must move to break free from dependence on oil. Please read my article on the Guardian on this issue: http://www.guardiannewsngr.com/index.php?option=com_content&view=article&id=82167:-a-practical-approach-to-breaking-the-resource-curse&catid=67:you-report-lagos&Itemid=583 1 Like |
Re: US Cuts Demand For Nigerian Crude by abugbe(m): 10:44am On May 28, 2012 |
pls so nigerians we shul start lokin 4 anoda alternative, mayb put most of our tim into agriculture. Dat ws wer we begin our life |
Re: US Cuts Demand For Nigerian Crude by Reference(m): 10:44am On May 28, 2012 |
Ogblikwe: Too much over reliance on oil revenue. The State ought to have by now developed other viable income generating sectors You and I are the State that must look elsewhere for income. |
Re: US Cuts Demand For Nigerian Crude by richy5(m): 10:51am On May 28, 2012 |
Glory b to God |
Re: US Cuts Demand For Nigerian Crude by AjanleKoko: 10:55am On May 28, 2012 |
^^ Well . . . at least Lagos has provided a template for a service-oriented economy. It's quite impressive what they've been able to achieve. The issue in Nigeria is not really the dependence on oil, but the fact that government has done little or nothing with the oil revenues, apart from servicing their running OPEX, and financing wholesale corruption. |
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