It's not been an easy couple of years to be in the oil and gas sector in Nigeria. The last government seems to have given away enormously under-valued concessions to anyone that asked, the currency has fallen off a cliff and no one really knows what it's worth, and oil prices have hardly been kind to countries that depend on a strong market. Sure, we are at last on top of the militancy problem and finally the government has given us a date for the Petroleum Industry Governance Bill (PIGB). But is it too little too late? Competitors have jumped on the opportunity, so what kind of a trade environment will greet Nigerian oil once it is ready to rejoin the world stage?



Today analysts are answering that question. In the time it's taken for Nigeria to get its act together with regard to its oil and gas sector, rising U.S. crude oil exports have taken a serious bite out of the foreign markets, such as China and Japan, that our recovering sector will depend on.



If we are to take heed of a new crude destinations report by the Nigerian National Petroleum Corporation (NNPC) for 2016, Japan did not buy Nigerian crude last year at all. Not one single tanker. And even China did not receive shipments from Nigeria after April last year.



Why? Because according to reliable sources in the Nigerian media, the US has been busy taking advantage of the competition vacuum by gobbling up as much of the spare trade as it can. Away from Nigeria's essential markets in Asia, the US has also been turning its sights on European markets where it has won favour with The Netherlands, the UK, and Italy. Worryingly for Nigeria, these are also export destinations for our crude. Many commentators are pointing out the obvious: we may find it very difficult, near impossible in fact, to win new markets amid the glut in the oil market.



Because it's a buyers' market, and the world has had a taste of the American dream. Last year, US crude exports averaged 520,000 barrels per day (bpd), up by more than 50,000 bpd compared to figures from the year before. And what's more, following the removal of restrictions on US crude exports in December 2015, the US exported crude to nearly 30 different countries in 2016, compared with just 10 countries the previous year. That's impressive however you look at it. For some indigenous Nigerian firms, it's good news when production triples, never mind export locations!



But it's the diversification story that is most impressive. It's not as though the US is neglecting obvious markets, or even grouping markets together by geography: this is a march of opportunism. In 2015, just 2 years ago, a whopping 92% of US crude exports went to Canada, which wasn't bound by the restrictions. Even after the restrictions were lifted, Canada remained the top destination marketplace, but received only 58 percent of 2016 crude exports. Now, the US is on course to take a bite out of every single market that Nigeria used to rely on for trade. The Netherlands, Italy, United Kingdom and France now rank fairly high on the list of US crude export destinations, with regional destinations in Asia, including China, Korea, Singapore and Japan coming up fast behind them.



The fight back is on though and Nigeria won't be going down easy now that resurgence is at last on the horizon. West African oil producers – led by Nigeria and Angola— are reported to be loading to export as many as 2.19 million bpd to Asia in February already, which would be the highest level in at least five and a half years.



Currently, China and India remain the largest buyers of African crude but with Nigeria's crude exports expected to rise to 1.66 million in May from 1.61 million bpd, local content suppliers have to get their act together before it's too late.

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