Chinese demand for Angolan cargoes heats up; Europeans targets Nigerian crude oil

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LONDON, Jan 10 – Demand for Angolan crude from Chinese independent refiners and for Nigerian cargoes from European customers has breathed life into the West African market, traders said on Thursday.

A drop in freight rates for shipping West African crude to China is partly behind the pickup, but predominantly, it is the so-called teapots that have started stocking up again after a lull during December, traders said.

The benchmark VLCC rate for the WAF-Asia journey is around its lowest since September, having hit three-year highs in November, which dealt a blow to demand particularly for Angolan crude.

Chinese refiners have also been asking for Congolese Djeno, one trader said.

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A shortage of distillate-rich crudes in the Mediterranean because of the drop in Iranian exports following U.S. sanctions has redirected some supply of the likes of Urals, Azeri or CPC away from northwest Europe, where refiners are instead turning to Nigerian grades.

Qua Iboe has changed hands at a premium of $1.75 to dated Brent this week, its highest in months, while supply of similar grades such as Forcados and Bonga were said to be virtually sold out.

* There are around a dozen Nigerian cargoes still believed to be available for sale but this is down from closer to 20 at the start of the week.

* In terms of tenders, Turkey’s Tupras awarded a tender for West African crude to Total. Traders said the grade involved was Forcados, while IOC’s tender for crude loading March 1-10 closed on Thursday, meaning the winner had not yet emerged.

* Around 10 cargoes of February-loading Angolan crude were still believed to be available for sale, broadly unchanged on Wednesday

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Godwin Okafor is a Financial Journalist, Internet Social Entrepreneur and Founder of Naija247news Media Limited. He has over 16 years experience in financial journalism. His experience cuts across traditional and digital media. He started his journalism career at Business Day, Nigeria and founded Naija247news Media in 2010. Godwin holds a Bachelors degree in Industrial Relations and Personnel Management from the Lagos State University, Ojo, Lagos. He is an alumni of Lagos Business School and a Fellow of the University of Pennsylvania (Wharton Seminar for Business Journalists). Over the years, he has won a number of journalism awards. Godwin is the chairman of Emmerich Resources Limited, the publisher of Naija247news.

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