Nigeria's 650,000 b/d Dangote refinery has bought its first cargo of Algeria's light sweet Saharan Blend crude, according to market sources.
Dangote bought the 1mn bl cargo from trading firm Glencore this week, sources said, adding that it is due to be delivered over 15-20 March. The deal was not directly confirmed be either party and the price is unknown.
None of the tankers that have loaded in Algeria so far in February have flagged Africa as their destination, suggesting this cargo will load in March.
One trader noted that Saharan Blend's quality is suitable for the Dangote refinery and that it is competitively priced compared to Nigerian grades. Nearly 420,000 b/d of crude was delivered to Lekki for Dangote so far this year, with about 82pc of that made up of light sweet grades, Vortexa data show. Nigerian crude accounted for 87pc of all arrivals.
The March-loading trade cycle for Saharan Blend was slow to kick off due to sluggish demand in Europe because of seasonal refinery maintenance and ample light crude supply. This may have encouraged buyers in Europe to hold off on purchases of Saharan Blend in anticipation of weaker price differentials, prompting sellers to look to alternative outlets.
Saharan Blend prices have dropped by $1/bl over the course of this month, when March-loading cargoes were trading, and now stand at a 20¢/bl discount to the North Sea Dated benchmark on a fob Algeria basis.
