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Tough Time Looms As Nigeria Loses Biggest Oil Customer

As US begins export of crude oil, Nigeria’s crude oil may suffer further setbacks in the global market.

The US Congress had on Friday approved the lifting of the ban as part of a $1.1tn spending bill, which included a provision that would allow . The bill was later signed by President Barack Obama.

READ ALSO: Tinubu Takes A Stand On Removal Of Fuel Subsidy

Following the lifting of the ban on the United States oil exports,  US can now export crude for the first time in more than 40 years.  An indication that Nigeria may soon lose its biggest customer.

President Barack Obama approved lifting of the ban

President Obama

The US now buys a small amount of Nigerian crude oil due to the dramatic rise in domestic shale production.

The growth in US light sweet crude oil production has resulted in a sizable decline in the country’s imports of crude grades of similar quality, such as Nigeria’s.

READ ALSO: Nigeria Loses Status As Africa’s Top Oil Producer

Since June 2014,  crude oil prices have been on the decline and this has consequently exacerbated the dwindling fortunes of the Nigerian crude, with the nation’s crude differentials trading at a 10-year low.

There are reports of Nigerian crude currently floating on ships with a significant amount finding home in storage tanks rather than in refineries as a result of the supply glut in the global market, which is dominated by largely by light sweet crudes.

Meanwhile, Kaduna refinery was said to have commenced production on Saturday. Esther Nnamdi-Ogbue, the managing director of Pipelines and Products Marketing Company (PPMC) said the refinery was reopened to meet up with the December deadline for the four refineries to return to full production.

While Nigerians await other refineries to commence full production as indicated by the PPMC, Nigerians are eager to witness the impact of this  on the ongoing fuel scarcity in the country.

Post from Naij.com

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