The Nigerian National Petroleum Corporation has cut down the price of crude oil as a result of a decline in the demand of the product.
In a statement released over the weekend, the NNPC said it will sell July supplies of Bonny Light crude at 23 cents more than Dated Brent. This, according to oil trading sources, was the smallest differential since 2005 and compares with a 50 cent premium in June and $2.55 a year earlier. The body also said it has lowered the official selling price for Nigeria’s largest crude oil stream, Qua Iboe, to dated Brent plus 35 cents per barrel, the lowest differential since May 2005.
According to reports from the vanguard,the reduction in price was as a result of declining demand for the country’s crude oil in the international market. The action, according to oil traders, was engendered by the need for the country to join in the fight for market share.
Nigeria which recquires crude oil to sell at $120-$150 dollars per barrel to sustain her national budget is currently going through hard times as a result of a fall in demand of the country’s crude and also a fall in price of crude oil in the international market.