Nigeria becomes Africa’s largest importer of refined petrol from Europe – S&P Insights.
In a recent analysis by S&P Global Commodity Insights, Nigeria has solidified its position as Africa’s primary importer of refined petrol, driven by a surge in petrol shipments from Europe to the continent.
The ban on Russian oil by the European Union since April 2023 has spurred a notable increase in crude oil shipments from the Middle East to Europe. Consequently, surplus refined petrol ships from Europe are finding their way to Africa, with Nigeria being the predominant destination.
However, the report also underscores that Nigeria’s reliance on petrol imports from Europe may be short-lived, given the imminent full-scale production from the Dangote refinery, boasting a capacity of 650,000 barrels per day.
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It is anticipated that the increased production from the Dangote refinery will lead to a reduction in Nigeria’s import demand, potentially reshaping the dynamics of petrol trade in the region. European exporters of petrol may consequently need to explore alternative markets or adjust their supply strategies.
Key Points to Note:
- Nigeria has undertaken significant initiatives in recent years to curtail its dependence on imported refined petroleum products. Notably, in 2021, the Nigerian National Petroleum Corporation (NNPC) acquired a 20% stake in the Dangote refinery for $1.036 billion.
- Additionally, the NNPC has embarked on contracts to rehabilitate the state-owned refineries located in Delta, Rivers, and Kaduna. Phase 1 of the Port-Harcourt refinery was completed in December, enabling the daily refining of approximately 60,000 barrels of crude oil, while the Delta and Kaduna refineries are progressing through various stages of completion.
- Despite delays since its commissioning in May 2023, the Dangote refinery, with a capacity of 650,000 barrels, commenced crude oil refining operations in December and officially started refining operations around February.
- Following the removal of the petrol subsidy in June, the federal government has been actively seeking to diminish crude oil importation, aiming to stabilize local prices and alleviate foreign exchange demand associated with imports.
