LONDON, Oct 25 – Prices for Nigerian cargoes slipped on Thursday, under pressure from punishingly high freight rates and unfavourable shipping economics, traders said.
* Qua Iboe was last said to be offered around $1.40 a barrel above dated Brent, but traders said this was probably too high to attract any buyers. Mainstays Qua Iboe and Bonny Light were quoted around $1.70 a week ago.
* Freight rates for both long- and shorter-range routes out of West Africa have risen sharply in the past month.
* In addition to expensive shipping, the fact that the dated Brent forward market is in backwardation is making it even less economical to move crude out of the region.
* To ship North Sea Forties crude to Rotterdam from Hound Point in Britain costs $1.25 a barrel TD-HPT-RDM, according to Refinitiv Eikon shipping data, compared with $1.80 a barrel to move Bonny Light to the same port, which is the most expensive for nearly two years. TD-BON-RM
* The dated Brent curve is trading at a backwardation of 46 cents, down from around parity at the start of October and down from a contango of more than $2 two months ago, meaning the longer a crude cargo stays in transit, the more money it costs the owner.
* India’s IOC has issued a tender to buy mainly West African crudes for Dec. 21-31 loading. The tender closed earlier on Thursday.
* Thailand’s PTT issued a tender to purchase 300,000 to 1 million barrels of light sweet crude for delivery between Dec. 20 and Jan 15. The tender closed on Wednesday.
* Saudi Arabia said on Thursday the oil market could be shifting towards oversupply in the fourth quarter of the year as oil inventories rise and demand slows and the top oil exporter would “mirror” such changes in its production.
* Nigeria’s cabinet agreed on Wednesday to submit to lawmakers an 8.73 trillion naira ($28.57 billion) draft 2019 budget, a reduction from a record 9.12 trillion naira in 2018, the budget minister said. (Reporting by Amanda Cooper; Editing by Mark Potter)