Diesel squeeze raises the appeal of Nigeria’s Forcados and Bonga crude

Nigeria’s medium-sweet Forcados and Bonga crude grades are gaining appeal with refiners as a global shortage of diesel and other middle distillates lifts demand for barrels that yield more of those fuels, BusinessDay reports.

The report cites S&P Global data showing the European diesel crack spread reached $98 a barrel on September 1 before easing to $95.30 on September 2. The August average was $80.50, compared with $71.71 in July and $44.75 in June. BusinessDay says the stronger refining margins have improved the relative attractiveness of West African crude, including Forcados and Bonga.

The report’s available excerpt does not state the premium paid for either Nigerian grade or the change in its realised export price. The crack spread measures refining economics; it does not quantify additional revenue received by Nigerian producers.

Read BusinessDay’s report (subscriber access may be required).