Nigeria Boosts Oil Exports as Shell Lifts Force Majeure on Forcados Crude

• Crude Oil Prices Drop by over 3% on Rising United States Inventories

Ejiofor Alike with agency reports

Royal Dutch Shell has announced the lifting of force majeure on the export of Nigeria’s Forcados crude oil, thus bringing all of the country’s oil exports fully online for the first time in 16 months.

But the cheery news has been cut short following fresh report that Crude oil prices slid more than three per cent wednesday after the United States government reported an unexpected increase in inventories of crude and gasoline, fanning fears that output cuts by major world oil producers have not drained the global crude glut very much.

US crude futures fell 4.3 per cent, or $2.04 a barrel, to $46.16 a barrel, its lowest level since May 9.
Brent crude prices were at $48.40 per barrel, down 3.4 percent, or $1.72 a barrel.

Crude stocks in the United States grew 3.3 million barrels to 513 million barrels, according to the US Energy Information Administration (EIA).

Following several months of repairs, Shell Petroleum Development Company (SPDC) had earlier restarted the Trans-Forcados crude export pipeline with the completion of the loading of the first tanker – Astro Perseus, at the Forcados terminal.

The crude oil tanker, it was learnt, had departed to Takoradi in Ghana. The Trans-Forcados pipeline was first attacked by the Niger Delta Avengers in February 2016, the first attack on a subsea pipeline in the country.
A spill that occurred on February 14, 2016 on the subsea crude oil export pipeline, had forced Shell to declare force majeure on Forcados liftings a week later.

Attempts to repair the 48-inch pipeline were frustrated by further attacks by the militants.
For instance, the pipeline resumed exports in October 2016 after it was repaired but was shut down in November after the militants bombed the subsea facility for the second time.

However ‘skeletal’ loading resumed at the facility few weeks ago with the loading of the first tanker – Astro Perseus.

But hope for increased revenue has been dimmed by crude oil prices which slid more than three per cent yesterday after the United States government reported an unexpected increase in inventories of crude and gasoline, fanning fears that output cuts by major world oil producers have not drained the global crude glut very much.
US crude futures fell 4.3 per cent, or $2.04 a barrel, to $46.16 a barrel, its lowest level since May 9.
Brent crude prices were at $48.40 per barrel, down 3.4 percent, or $1.72 a barrel.

Crude stocks in the United States grew 3.3 million barrels to 513 million barrels, according to the US Energy Information Administration (EIA).

Forecasters had predicted a drop of 3.5 million barrels, especially a day after preliminary data from the American Petroleum Institute indicated an even bigger drop.

Crude prices slid even as some in the market remained concerned about the move by OPEC members – Saudi Arabia and the United Arab Emirates to cut diplomatic and transport ties with Qatar, an OPEC member that had agreed to cut only about 30,000 barrels a day as part of the cartel’s agreement to reduce output.

Reuters reported that analysts saw a risk that rivalries between OPEC members could weaken the production cut agreement.

Some were already concerned about rising production from Libya and Nigeria, which are exempt from the agreement.
OPEC has pledged to cut almost 1.8 million barrels per day (bpd) to help reduce global inventories.