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Vol 37 No 13

Published 21st June 1996


Nigeria

Fat margins

Oil traders and their sponsors may grumble that prices are low. But for the well-connected trader Nigeria is offering some of the best returns around. A comparison of official prices and spot prices during the two years to May 1996 shows, on average, a margin of 12.17 US cents a barrel for Forcados grade and 12.02 cents for BQ (Bonny Light and Qua Ibo). On a cargo of one or two million barrels, that split (even after deduction of 'sponsorship' fees of about eight cents a barrel) makes a lot of dollars. Six months after Oil Minister Dan Etete cancelled 21 contracts, most traders are not worried that the military regime has failed to renew them. For most of that period, official prices have been well below spot prices and traders have been correspondingly happy.

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