Nigeria's Dangote to import 9mn bl WTI crude in June

Market: Crude oil
21/05/25

Nigeria's 650,000 b/d Dangote refinery has bought 9mn bl of US light sweet WTI for delivery in June, according to traders, the most for any month since it started up in early 2024.

Trading firm Vitol sold three 2mn bl shipments, and trading firm Petraco sold one 2mn bl cargo and a Suezmax-sized shipment. Only one 2mn bl cargo of WTI has arrived at Dangote in May to date, after three in April, according to Vortexa.

Dangote was built to run Nigerian crude, but its share of local grades has been 50pc or less in recent months.

Nigeria's state-run NNPC allocated six June-loading cargoes to Dangote — two of medium sweet Escravos, and one each of light sweet grades Brass River, Bonny Light, Okwuibome and Yoho — for a maximum of 6mn bl.

Market participants expect NNPC to slightly increase its official crude formula prices for June supplies, which should surface before the end of May. Even small increases to official prices would erode the appeal of Nigerian grades compared with WTI.

WTI for front-month delivery averaged a 90¢/bl premium to North Sea Dated on a delivered-Europe basis in the 1-20 May period. The deals to Dangote were struck at similar levels on a delivered-Nigeria basis, although price levels were unconfirmed. Escravos' official price was a $1.63/bl premium to Dated for May, and Bonny Light was 48¢/bl above the benchmark on a fob basis — already close or higher than delivered WTI prices, without freight.

Dangote has provided an outlet for US light sweet crude at a time of subdued demand from Europe. Around 1.5mn b/d of WTI is booked to arrive to Europe in June, which is lower than typical amounts, according to traders. Tracking data do not always capture the amount of WTI accurately.

Relatively cheap Caspian CPC Blend has been weighing on European demand for WTI, according to traders. The Caspian light sour grade has been on average $3.20/bl cheaper on a cif Augusta basis than WTI on a cif Rotterdam basis in May to date. Taking CPC Blend to northwest Europe would incur some additional freight costs, and narrow its discount relative to WTI, but the grade would be still priced below the US crude.

Europe is grappling with a glut of light crude grades, partly because of far higher Kazakhstan production an muted Asia-Pacific demand for it, as well as lower demand in Europe due to permanent closures of some refineries.

By Lina Bulyk and Sanjana Shivdas

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