Differentials for West African crude slide as virus fears, margins weigh

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Offers for many West African grades continued to slip as Chinese buying eased and European demand remains sluggish, with fears for a second wave of coronavirus infections and generally poor refining margins worldwide weighing on sentiment.

* Weeks of Chinese buying which have firmed up prices in previous weeks has lost steam.
* Around 10 cargoes of crude oil remain to be sold in July as August export programmes are due at the beginning of next
week, marking one of the poorest months for sales recently.
* Heavier Angolan Dalia crude and Congolese Djeno were last offered at around a $1 above dated Brent, significant slides from offers about a week earlier.

* At least 30 cargoes remain for export in July, as margins recovered slightly globally but gasoline stocks have stayed
stubbornly high in key European markets.
* Indian demand continues to provide a bright spot as refiners in the country consistently absorb Nigerian cargoes though storage levels remain high there.
* Two traders said offers for lighter Nigerian crudes at around $1 above dated Brent were still too high to attract Western buyers.

* India’s HPCL has two spot tenders for 2 million barrels of oil, including mostly West African grades. One is for Sept. 1-10
delivery and the other for Oct. 1-10. Both close next week.
* Uruguay’s Ancap had issued tenders for oil including West African grades due to arrive in August, set to close next week.


Source: Reuters

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