Shell halts deliveries from Nigeria

13/02/2009

Royal Dutch Shell has declared force majeure on deliveries from fields in the Niger Delta region of Nigeria because of heightened security risks.

The company, which has already halted shipping of liquefied natural gas from the region, confirmed yesterday (February 12th) that it would halt deliveries until at least the beginning of March.

The move follows a warning from rebel group the Movement for the Emancipation of the Niger Delta, in which it called for all foreign oil companies in the region to evacuate or face increased military attacks on rigs and pipelines.

As prices were rising in 2008, supply disruptions in the Niger Delta resulted in a sharp increase in the costs of crude and distillates such as heating oil as investors grew wary that deliveries would halt.

However, Shell's announcement has not had the same effect this time, as crude futures continued to plummet amid weak global demand for the natural resource and its derivatives such as heating oil.