West African grades of crude oil has been affected by oversupply, with little fresh trading.
Many buyers, according to report, expected differentials to soften further as pending tenders hindered new deals.
According to Reuters, there were some 60 unsold cargoes of Nigerian crude, including 20 from the June loading plan. The July Forcados export plan has not been issued, meaning there were between six and eight additional cargoes that would likely come into the market.
The report noted that traders said Forcados would likely sell initially at a discount to dated Brent until it proved its reliability. Shell just lifted force majeure declared on the Forcados crude grade after more than a year.
Oil prices hovered close to one-month lows after unexpected surge in U.S. inventories and the return of Nigerian Forcados crude aggravated investor concerns about an already oversupplied market.
China’s crude oil imports rebounded to the second highest on record in May, making China the world’s top buyer for the month amid concerns over tightening crude supply to Asia and an extension of producer cuts to March next year.
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