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Shell Petroleum Development Company of Nigeria Limited has declared force majeure on exports of Bonny Light crude, one of the country’s major sources of oil revenue. Force majeure is a legal clause that allows companies to cancel or delay deliveries due to unforeseen circumstances.
Reuters quoted traders as saying that a surplus of unsold cargoes was so large that differentials struggled to hold steady.
The SPDC, the Nigerian subsidiary of Royal Dutch Shell, said on Thursday it had declared force majeure on Bonny shipments with immediate effect. It said the shutdown of the Nembe Creek Trunk Line had prompted the force majeure. Exports of Bonny Light are expected to run at around 195,000 barrels per day next month.
According to traders, only one tanker is scheduled to load Bonny Light crude over the next two weeks. Shipments of Erha crude were also said to be delayed, but this had not yet had a knock-on upward effect on prices of other grades, two traders said. Prior to the declaration of force majeure on Bonny Light exports, the nation’s crude shipments were already witnessing delays following a leak on the 200,000 to 240,000 bpd Trans-Forcados pipeline that shut down earlier this week, effectively cutting deliveries of Forcados, the country’s largest crude grade.
Photo Caption: Shell Logo
