Traders see few jet fuel exports to Nigeria

LONDON – European oil companies are unlikely to ship sizeable spot volumes of jet fuel to shortage-hit Nigeria this month as a flatter forward market curve has reduced export profit margins, traders said yesterday.

Nigerian airlines have been hit by a lack of jet fuel, caused by a shortfall in imports by major marketers, leading to cancelled flights and delays for hundreds of travellers. European traders can sell jet fuel shipments to Nigeria on a bill of lading or prompt basis, and then make a profit by buying oil later in the month at cheaper forward prices.Front month November gas oil on London’s International Petroleum Exchange (IPE), which serves as an underlying value for prompt jet fuel cargo prices, has crashed over six percent this month, while the December contract has not fallen as hard.The spread between November and December gas oil was at US$4,50 (N$27,90) on Tuesday, compared to much wider forward discounts or backwardation last month.-Nampa-ReutersEuropean traders can sell jet fuel shipments to Nigeria on a bill of lading or prompt basis, and then make a profit by buying oil later in the month at cheaper forward prices.Front month November gas oil on London’s International Petroleum Exchange (IPE), which serves as an underlying value for prompt jet fuel cargo prices, has crashed over six percent this month, while the December contract has not fallen as hard.The spread between November and December gas oil was at US$4,50 (N$27,90) on Tuesday, compared to much wider forward discounts or backwardation last month. -Nampa-Reuters