Wednesday, September 23, 2020
MARKET UPDATE
Advertisement

TheCable

Advertisement
 ON THE GO

Nigeria’s oil export drops as Shell declares force majeure on Forcados crude

Nigeria’s oil export drops as Shell declares force majeure on Forcados crude
April 10
12:47 2020

Shell Petroleum Development Company of Nigeria has declared force majeure on Forcados crude oil.

Advertisement

Reuters reports that Heritage Energy Operational Services Limited, the company that runs the Trans Forcados pipeline, closed the pipeline on April 4.

No explanations were provided for the action.

The force majeure on the 400,000 barrel capacity pipeline came into effect on Monday, April 6.

Advertisement

Forcados pipeline, which exports an average of 240,000 barrels of crude oil daily, is one of Nigeria’s main crude oil terminal.

Force majeure refers to a clause in contracts that allows both parties to walk out of the contract when an extraordinary event or circumstance beyond the control of the parties happen.

At a virtual meeting on Thursday, Nigeria agreed to reduce its crude oil production by 417,000 barrels per day to be part of a new deal agreed by the Organisation of Petroleum Exporting Countries (OPEC) and its allies (OPEC+).

Advertisement

In total, 10 million barrels would be cut from the world’s daily crude oil production.

The cuts would last for May and June 2020.

Industry closures as a result of the COVID-19 pandemic have affected demand leaving Nigeria with unsold cargoes.

The federal government has adjusted revenue estimates and budgeted spending for the 2020 fiscal year to align with current realities.

Advertisement

0 Comments

No Comments Yet!

There are no comments at the moment, do you want to add one?

Write a comment

Write a Comment