US annual imports of Angolan crudes are on track to surpass imports of Nigerian crudes for the first time since the US Energy Information Administration started tracking such data in 1973, Platts analysis of EIA data showed.
As the tight oil boom continues to reduce US imports of West African crude, heavier Angolan grades have proved more resilient than their lighter regional counterparts, according to recent EIA data.
US Angolan deliveries have averaged around 116,000 b/d to the US since the start of 2014, compared with just 75,000 b/d for Nigeria crude, according to recent EIA import data.
Sources said the main reasons for the increase in Angolan imports and decrease in Nigerian shipments are the comparative ease of blending Angolan grades with shale crude, as well as demand for heavy refined products and feedstocks, which favors Angolan crudes.
Shale crude is very light and sweet and similar in quality to Nigerian crude. As a result, the US no longer needs as much Nigerian oil as it once did.
However, Angolan crude has proven far more appealing to US refiners, as it is mostly of a heavy, sweet variety. Its low specific gravity makes it denser, and it also has a low sulfur content. Heavy sweet crudes are used to blend with the light sweet shale crude and this has encouraged a preference for Angolan crudes by US refiners.
Product yields for major Angolan grades like Cabinda, Dalia, Girassol and Hungo are skewed toward the bottom of the barrel, with vacuum gasoil and residual fuels accounting for approximately half of output. These elements are also valued by US refineries as blending feedstocks.
The most recent yearly data shows Angolan exports to the US down 59% from a peak of 534,378 b/d in 2006, while Nigerian exports fell 75% over the same period.
For six consecutive weeks between June 27 and August 8, the US imported no crude from Nigeria, the longest period that the US has gone without imports from the West African country.
As recently as 2010, Nigerian flows to the US averaged over 1 million b/d.
The arbitrage of crude oil from West Africa to the US Gulf Coast and the US East Coast has historically been one of the major trade routes in the global oil market. However, imported volumes have been dropping steadily since at least 2011, as domestic US crude production has soared, displacing arbitrage barrels from Nigeria and Angola.
In 2013, US imports of Nigerian and Angolan crude oil comprised 5.04% of total US imports, averaging 497,000 b/d. Of this volume, Nigeria’s contribution averaged 281,000 b/d while Angola’s averaged 216,000 b/d.