Nigerian crude oil sellers are struggling to find buyers on the global market, even as the Dangote Petroleum Refinery recently cried out over the low supply of the feedstock locally.

According to a Reuters report on Thursday, West African crude oil sellers are struggling to find buyers for up to December 26- and January-loading cargoes due to stiff competition from plentiful and cheaper alternative supplies.

About 20 million barrels of Nigerian oil for December and January loading remained unsold by Thursday, according to two traders who spoke with Reuters.

This comes as the Dangote refinery recently said it was importing heavily from the United States, Ghana, and other African countries due to a lack of sufficient supply from local oil producers.

According to the Reuters report, the amount of unsold Nigerian and Angolan crude, analysts said, is a symptom of a wider oil market surplus. This drove selling on the international futures market, pushing Brent crude below $60 per barrel to its lowest level since May this week.

“The overhang of West African cargoes partly reflects the broader global crude supply surplus emerging in Q1,” said Victoria Grabenwoger of analytics firm Kpler.

It was reported that “approximately 20 million barrels of Nigerian oil for December and January loading remained unsold by Thursday, according to two traders, while Angola’s December-January programmes still had as many as five to six cargoes available.”

These cargoes have reportedly slowed the start of the trading cycle for February cargoes, even though Angola’s loading schedule and term nominations have already been released.

The report added that such a large amount of unsold oil is unusual, especially for the current month, given that the West African trade cycle is typically closer to two months ahead.

Estimates for both countries’ overhang were as high as 40 million barrels earlier this week. “Current market softness appears to be partly seasonal and partly due to shifting buying patterns in response to freight costs and alternative supply options,” said OilX analyst Francisco Gutierrez, adding that Angolan January trade is 20 per cent behind its long-term average pace because the world’s biggest commodities buyer, China, has switched to cheaper or nearer alternative grades.

Supplies from the Middle East are said to be displacing medium and heavy West African grades in Asia, as lowered official selling prices in January, and shorter voyages give those grades a competitive edge, the analysts were quoted as saying.

India’s oil imports from Russia have remained resilient despite tightening Western sanctions, displacing medium-heavy density West African crudes, while light- to medium-density West African grades are struggling to compete with supplies from Argentina and Brazil, two traders stated.

“Nigeria has also been left to market more oil because of reduced imports by Africa’s largest oil refinery, the 650,000-barrel-per-day Dangote plant, which will in January undergo maintenance,” Kpler’s Grabenwoger said.

However, during a media briefing on Sunday, the President of the Dangote Group, Alhaji Aliko Dangote, complained about low crude supply despite the domestic crude supply obligation under the Petroleum Industry Act. Dangote said the refinery had been importing crude oil from various countries in order not to run out of feedstock.

Asked if the naira-for-crude deal had solved his challenge of low crude supply, he retorted, “We are not getting enough crude still; that’s why we buy from Ghana, we buy from a few African countries, and we buy from the United States. The US has been one of our major suppliers. On average, we don’t buy less than 100 million barrels from the US. The US is also a major beneficiary of our refinery,” the billionaire businessman said.

There was friction between the Dangote refinery and the Nigerian Upstream Petroleum Regulatory Commission over the domestic crude supply obligation.

In June 2024, Dangote’s deputy, Devakumar Edwin, accused international oil companies of deliberately frustrating the refinery’s access to local crude by selling above the market prices, forcing it to import crude from the United States and other countries.

The refinery also accused the NUPRC of failing to enforce the domestic supply obligations. Although the NUPRC defended its actions, the dispute lingered until the Federal Government ordered the Nigerian National Petroleum Company Limited to sell crude to Dangote in naira.

The naira-for-crude deal, which began in October 2024, boosted local fuel supply, reduced queues and contributed to price cuts. Dangote subsequently slashed petrol prices from about N1,100 per litre to N875, and later to N739. However, he has said repeatedly that the refinery still depends on imported crude to keep its operations running.