Oil & Gas

Kuwait’s new ‘super light’ crude may threaten Nigeria’s Asian market

by FRANK UZUEGBUNAM

February 14, 2018 | 1:19 am
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bout 29 percent of Nigeria’s crude oil exports end up in Asia, mostly India and Indonesia, and then other key demand hubs in China, Japan and South Korea. Nigeria and other West African crude oil exports to Asia particularly India and China hit about 2.2 million barrels per day (bpd) in September 2017.

Nigerian market share of the Asian crude oil market may be threaten following the current testing of Kuwait’s new ‘super light’ crude in the Asian market. At least one Asian refiner has tested samples of the Kuwait’s new “Super Light” crude oil and found it suitable, sources said.

The test run comes as state-owned Kuwait Petroleum Corp. prepares to launch its first new export grade in decades. A number of refiners in northeast and southeast Asia, a key destination for Kuwaiti crudes, showed their interest in testing the new grade, market sources said.

Kuwait Oil Co. (KOC), state-owned upstream operator recently began operations at a new facility to produce light oil and gas from the West al-Rawdatain field, which will be combined with output from other fields for the country’s newest crude blend to be launched in April.

KOC first discovered super light crude oil at the Sabriya field in 2005. After years of delays, KOC finally began production earlier this year from the field, along with the Umm al-Niga, and the West Rawdatain fields.

KOC expects to produce 200,000 b/d of light oil. By 2020, the company expects to boost this by another 220,000 b/d. Crude from the fields will be blended to make KPC’s “Super Light” crude oil grade, which it hopes to start exporting from April. The crude grade will have an API gravity of 48 degrees, with 0.4 percent sulfur content.

Traders were hopeful that the new grade could potentially put the brakes on the recent uptrend in light sour crude price differentials in the Middle East, while providing a new feedstock procurement option for Asian refiners that regularly need to run middle distillate-rich crude oil.

Asia uses half the world’s oil and has become a hotspot for a price war among producers who are offering steep discounts to lock in buyers in the face of bulging global supplies.

FRANK UZUEGBUNAM

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by FRANK UZUEGBUNAM

February 14, 2018 | 1:19 am
12893  |   93   |   0  |   Start Conversation

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