Another country overtakes India as Nigeria’s crude oil buyer

The Netherlands has overthrown India as Nigeria’s biggest crude oil buyer.

According to National Bureau of Statistics (NBS) data, the Netherlands bought Nigerian crude worth about N2.5 trillion in the first nine months of 2023. India imported N1.6 trillion of crude oil during the same period.

Indonesia and France took the second and third spots as they bought N1.72 trillion and N1.65 trillion worth of crude, respectively.

India chooses another country for crude oil

Reports say that India has shown interest in buying highly discounted Venezuelan crude to diversify imports.

Indian buyers began taking up crude shipments from Venezuela weeks after sanctions relaxed, opening a new frontier for Chinese independent refiners that have remained active buyers from the South American country in recent years.

Shipping data showed that India had returned to the market for November and December, loading Venezuelan crude after three years of suspension.

The rise aims to exploit the high middle distillate margins by processing fuel oil directly in the secondary unit to enhance the intermediate distillate yields, S&P Global said.

Analysts believe the increase in cheaper alternative crude oil suppliers for Asian countries is unsuitable for Nigeria, failing to take advantage of the high oil price.

India moves to transition to renewables in the coming years

They say the new pace of global oil transition threatens Nigeria’s oil revenue.

The information shows that India wants to shore up its manufacturing capacity, with the government launching renewables to increase made-in-India energy components to reduce imports and boost self-reliance.

The country offers tax cuts, subsidies for capital costs, and concessions to manufacturers sourcing raw materials from the domestic market.

Analysts worry Nigeria may lose its key markets

Energy policy analyst and Team Lead of Platforms Africa, Adeola Yusuf, stated that India’s newly found market in Venezuela may mar Nigeria’s chances of meeting its self-imposed production quota of 1.8 million barrels in 2024.

“Nigeria has to look elsewhere for buyers of its crude. Countries like Spain and the Netherlands can well replace India as Nigeria’s top buyers if the country plays its cards well,” he told Legit. ng in an interview.