Nigeria’s crude oil export business has suffered yet another setback as Venezuela, which used to be one of Nigeria’s major importers of the commodity, has opted to be buying from the United States of America.
The United States, Nigeria’s past top crude oil importer, became self-sufficient with its shale exploitation, rising to become one of the world’s biggest producers.
Though Venezuela has one of the biggest oil reserves in the world put at about 298 billion barrels, the country’s oil is very heavy and hard to refine and then sell to other countries.
Specifically, Nigeria’s crude oil export destination report from the Nigerian National Petroleum Corporation (NNPC) for 2015, showed that Venezuela did not import crude oil from Nigeria in January and February but only managed to import 951,005 barrels in March.
Venezuela again recorded zero import from Nigeria in April to October before importing about 949,469 barrels.
Indeed, Petroleos de Venezuela SA, the state-owned oil company, has ordered millions of barrels of crude from the U.S. this year, a sign of how the lifting of the ban on U.S. oil exports last year has scrambled world energy markets.
In February, Venezuela’s state-run oil company imported a 550,000 barrels cargo of U.S. West Texas Intermediate crude at one of its terminals in the Caribbean, according to trade source.
Already, traders stated.around 80 million barrels of Nigerian and Angolan crude oil are on the market with at least a dozen May-loading cargoes still unsold.
Indian refiners, which had bought large quantities of Nigerian oil in March and April, are now turning to cheaper Iraqi Basra and Venezuelan crudes.
Earlier this month, the company issued a tender for 12 million barrels of crude from April to June, including WTI, Russian and Nigerian oil. Last week, the oil tanker Orpheas was stated.to be en route to Curacao from the U.S., according to ship-tracking data compiled by Bloomberg and a person familiar with the matter. The vessel is a Suzemax tanker, with a typical cargo capacity of 1 million barrels.
In 2015, the company imported about 40,000 barrels a day from countries including Russia, Nigeria and Angola, according to data compiled by Bloomberg. Now, that’s increasingly coming from the U.S., where the ban on exporting most oil was lifted in December.
“Venezuela needs to first mix its heavy oil with lighter types of crude to balance out the quality,” CNN said, quoting Nilofar Saidi, an oil market analyst at ClipperData.
Saidi stated.Venezuela had already been importing lighter types of crude oil from Russia, Angola and Nigeria. “It’s just cheaper to bring a tanker of light crude from the U.S. Gulf than to ship it from West Africa or North Africa.”
The South American country has long had frosty relations with the United States. Still, it has ordered 500,000 barrels of U.S. crude from oil trader PetroChina Co. Limited. That’s on top of 5.4 million barrels of benchmark West Texas Intermediate oil it ordered and at least 1 million barrels shipped this month to PDVSA’s refinery in nearby Curacao, according to Reuters report.
NuStar Energy and ConocoPhillips loaded a vessel with light crude oil pumped from the Eagle Ford Shale of South Texas at NuStar’s North Beach Terminal at Port Corpus Christi. The crude is to be sold to the international trading company Vitol.