*US ships first 2mb at $2 discount to country
with Agency reports
03 October 2017, Sweetcrude, Lagos — Nigeria’s 400,000 barrels per day crude oil exports to India may be under threat as the United States on Friday, shipped its first 2 million barrels to the country at a discount of $2 per barrel.
The cargoes will be received by India’s state oil firm, Indian Oil Corporation Ltd on Monday, according to findings.
The US re-entered the export market last year, increasing competition.
An official from the US government on Friday said the shipment containing two million barrels of oil comes at $2 less per barrel than Dubai crude, which makes up a large part of the crude oil mix that state-owned refiners process in India.
By next year March, Indian Oil and Bharat Petroleum Corp. Ltd would have received eight shipments from the US, tenders signed by both countries have shown.
“The US’ entrance to the export market brings down costs for consumers and is an opportunity for India to diversify its sources of import,” said the official cited above.
The shipment is part of the strategic energy partnership Prime Minister Narendra Modi and US President Donald Trump agreed to at a June meeting in Washington.
India imported 214 million tonnes (mt) of crude oil in 2016-17, 5.4% more that what the country imported a year ago. With the ambition of becoming a regional refining hub, India is adding more refinery capacity.
Nigeria is the largest African crude oil supplier to India.
India imports 400,000 barrels per day from Nigeria at US$10 billion annually.
Additionally, major India oil companies regularly issue tenders of Nigerian crude oil.