Mobil Producing Nigeria
Unlimited, a unit of ExxonMobil, will resume shipment of Qua Iboe crude,
Nigeria’s largest grade of crude oil in October, three months after the company
had declared force majeure on the exports of the grade.
Today
News report continues:
This
is coming as oil prices slumped three per cent Tuesday following another gloomy
prediction by the International Energy Agency (IEA) on demand growth that
suggested that oversupply in the oil market might persist for longer than
anticipated.
ExxonMobil
had declared the force majeure after it observed a leak caused by what it
described as a “system anomaly” during a routine check of its loading facility
on July 14, this year.
The
cause of the leak was not clear, but the force majeure came just days after a
militant group, the Niger Delta Avengers (NDA), claimed to have bombed the
company’s 48-inch Qua Iboe crude oil export pipeline on July 11.
But
24 hours after the claim by the militants, the company’s spokesperson, Todd
Spitler, debunked the claim, saying “there was no attack on our facilities.”
However,
citing industry sources, Reuters reported that the company is offering an
October-loading cargo of Qua Iboe crude oil, the first offer since the company
declared the force majeure.
It
was not clear if the pipeline had been repaired, or if the company expected it
to be back on stream in time to load crude in October.
But
the cargo is offered for October 8-16 loading at a premium of $1.80 per barrel
to dated Brent.
A
spokesman for Exxon said the force majeure remained in effect but did not give
a timeframe on the resumption of operations.
While
ExxonMobil said at the time it declared force majeure that the export terminal
was operating, traders said the company did not release a revised loading
schedule for the crude exports.
The
last ship to load crude at the Qua Iboe terminal was the Ottoman Nobility on
July 9.
One
of the three other ships scheduled to load the crude had been near the terminal
since July 12.
A
vessel loads one million barrel of the grade every three to four days, and
exports of 250,000 barrels per day aboard eight vessels were scheduled for
July.
Before
it declared a ceasefire recently, the Avengers had warned that if the company
moved forward with repairs “something big…will happen,” and threatened to
attack the company’s workers, instead of blowing up its facilities.
Shell-operated
Forcados crude oil exports were halted since the Avengers attacked its subsea
pipeline in February.
In
a related development, oil prices fell tuesday on concerns over increased
drilling in the United States and as investors took profits after oil prices
rose close to one per cent in the previous session.
While
the Brent crude was down US$1, or 2 per cent, at US$47.32 a barrel, the US West
Texas Intermediate crude fell US$1.25, or 2.7 per cent, to US$45.04.
The
IEA, energy adviser to over 26 industrialised countries, said a sharp slowdown
in global oil demand growth, coupled with ballooning inventories and rising
supply, means the crude market would be oversupplied at least through the first
six months of 2017.
IEA’s
gloomy forecast came a day after OPEC also predicted oversupply in the oil
market in 2017.
IEA’s
prediction contrasts with the agency’s last forecast a month ago for supply and
demand to be broadly in balance over the rest of this year and for inventories
to fall swiftly.
The
IEA’s latest comments follow a surprisingly OPEC’s bearish outlook published in
the cartel’s monthly Oil Market Report (OMR) on Monday.
Oil traders were quoted as saying that the price falls were an indication that increasing oil drilling activity in the United States was still a concern.
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