West African crude demand weakens as differentials rise

On Monday, West African crude oil differentials surged beyond expectations, causing a dip in demand among regional buyers, according to traders. Despite a minor decline in freight rates, market participants took a cautious stance, expecting further adjustments, a trader revealed. Reporting agencies indicated that Nigerian crude grades such as Bonga and Forcados were trading around $6 more than dated Brent for October delivery.

Two additional traders corroborated the elevated prices and suggested that the fair value could be reached once differentials dropped by one to two dollars. A Nigerian refinery's crude tender was scheduled to conclude, with results slated for announcement on Wednesday. Traders had previously reported that September cargoes of Angolan and Nigerian crude were still available on the market. This report was produced using AI assistance and subsequently reviewed by an editor.