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Petrol Tankers Unable To Deliver Supplies To Nigeria

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Petrol Tankers Unable To Deliver Supplies To Nigeria

Petrol tankers unable to deliver in nigeria Petrol tankers

Jan 14, 2012 – Petrol Tankers Unable To Deliver Supplies To Nigeria

Five days of strikes have forced ports to shut • Shipping delays costing charterers $18,000 a day •Crude swaps account for around half of petrol imports.

Petrol tankers are unable to deliver supplies to Nigeria as strikes which entered their fifth day  yesterday have forced ports to close, trade and shipping  according to sources.

Workers have been on strike over the lifting of  fuel subsidy that has led to prices more than doubling at the pump.

“The ports are shut, yes, it is affecting things. Nothing in or out at the moment,” said a petrol dealer.

Tankers are being held outside ports at the expense of charterers, who are paying demurrage costs of around $18,000 a day.

“People waiting there have a huge issue on their hands… around 1 mln tonnes of gasoline waiting to offload,” said a dealer, adding  that he had cancelled plans to deliver two cargoes to the country Nigeria this week.

Demurrage costs are payable to a ship owner by a charterer for a delay for which the owner is not responsible. Shippers say these costs have not increased despite the current strike.

“They (Nigerian shipments) are fairly prone to delays anyway but even more than usual now with the strike. So far it’s fairly flat,” a shipping source said regarding demurrage costs.

The OPEC member’s biggest oil union said it was ready to halt oil output if the government did not reinstate the subsidy, piling pressure on President Goodluck Jonathan to reach a compromise.

So far, strikes have not hit oil exports, according to traders and oil officials, partly as some processes are automated or dependent on non-unionised workers operating platforms offshore.

Nigeria exports over two million barrels of crude oil per day and is a major supplier to the United States and Europe, providing Africa’s second-largest economy with over 90 percent of foreign exchange revenues.

The threat of a cut in oil output was a deciding factor in prompting the government to start negotiations with union leaders, sources said.

Worries over Nigerian oil supplies have helped push up global oil prices in the last two days.

Nigeria has typically relied on crude oil exports for around half of its gasoline needs through swap exchanges. Industry sources have said a number of key deals were renewed for 2012, including a 60,000 barrel a day deal with Swiss-based trading house Trafigura.

The other half is imported via regular tenders. In December, Nigeria was seeking to buy around 1.35 million tonnes of petrol in the first three months of the year.

Trade unions said strikes would be suspended today and tomorrow to allow leaders to travel for negotiations with the government, and it was not clear whether the suspension would enable vessels to discharge over the weekend.

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