After the loss of the American market, Asia became Nigeria’s safe haven, however this may not be sustained for much longer.
This development that has made oil industry experts to urge the Federal Government to form alliances with the Asian customers to cushion the effects.
The Arab producers, who have always been on constant price war last week even pushed the notch higher because of the sliding crude oil prices, by offering discounts as high as above $4 per barrel, the highest in over a decade in order to retain their respective market shares.
Bloomberg recently reported that Iraq, Kuwait and Iran have joined Saudi Arabia in cutting their March crude prices for Asia, signaling the battle for a share of OPEC’s largest market is intensifying.
“Iraq’s Basrah Light crude will sell at $4.10 a barrel below Middle East benchmarks, the deepest discount since at least August 2003, the Oil Marketing company, said on Tuesday, February 10.
National Iranian Oil Co. said its official selling price for March Light crude sales will be a discount of $2.10 a barrel, the widest since at least March 2000, according to a company official who asked not to be identified because of corporate policy.
Kuwait Petroleum Corp. said Wednesday its discount will be $4.10, the biggest since August 2008,” the report said.
The report further added: “Middle Eastern producers are increasingly competing with cargoes from Latin America, Africa and Russia for buyers in Asia. Oil prices have dropped about 45 percent in the past six months as production from the U.S. and OPEC surged.”