Crude oil inventory from West Africa, including Nigeria and Angola is building. The supply build-up will expand even more as the December Program gets set to hit the market.
Although spot buying from China increased for the November loadings, traders said even this was not enough to shore up differentials to dated Brent.
In Nigeria, more than 20 November loading cargoes are still out looking for buyers, including for Bonny Light and Qua Iboe. Furthermore, at least 5 November loading Angolan cargoes are also still available and seeking for buyers.
In spite of the unsold November stock, sellers are already willing to offer discounts to sell off the December cargoes on time, which are expected to come to market later this week.
“It’s not a pretty picture at the moment,” a trader said.
OPEC members and 8 non-members met on Wednesday to discuss measures to save the market, but no agreement was reached on production cuts. Non-OPEC producers have so far refused to work with OPEC in cutting supply to reduce a surplus.
Gulf OPEC members, including top exporter Saudi Arabia, have shown no interest in returning to a strategy of supporting prices, choosing instead to fight for market share.