Faith Nyasuguta
Dangote’s oil refinery in Nigeria is reshaping global fuel markets, with its impact now being felt in Europe. According to the Organisation of the Petroleum Exporting Countries (OPEC), the massive production of Premium Motor Spirit (PMS) at the $20.5 billion Dangote refinery is disrupting Europe’s gasoline market, forcing adjustments in trade flows.
For decades, Nigeria relied heavily on Europe for refined petroleum products. However, the Dangote refinery, capable of processing 650,000 barrels of crude daily, has reversed this dependency. OPEC reports that Nigeria’s reduced imports of petrol from Europe, coupled with the refinery’s export activities, are shifting market dynamics.
“The operational ramp-up at Nigeria’s new Dangote refinery and its gasoline exports to international markets are likely to weigh further on the European gasoline market,” the OPEC report noted.
This shift is creating a ripple effect in Europe’s fuel trade. The Amsterdam-Rotterdam-Antwerp storage hub, which serves as a key node for European gasoline, has seen stockpiles remain robust. Yet, the gasoline crack spread in Rotterdam against Brent crude has edged up due to strong exports.
As the Atlantic Basin grapples with an extended gasoline balance, further inventory growth is expected in the coming months, according to OPEC.
A New Era For African Oil
The Dangote refinery’s influence extends beyond Nigeria. In October 2024, reports revealed the refinery was preparing to process 400,000 barrels of Nigerian crude daily, disrupting Africa’s oil trade and ending Europe’s dominance in the continent’s gasoline market, valued at $17 billion annually.
The refinery’s capacity surpasses Europe’s largest refineries, such as the Pernis Refinery in the Netherlands (404,000 barrels per day) and Italy’s GOI Energy ISAB Refinery (360,000 barrels per day). Bloomberg has already ranked the Dangote refinery above Europe’s ten largest refineries, a significant feat for Africa’s richest man, Aliko Dangote.
Since commencing production in January, the refinery has positioned Nigeria as a self-sufficient petrol producer while threatening Europe’s grip on Africa’s energy trade. Experts suggest this could mark the end of decades-long gasoline imports from Europe to Africa, reshaping the global energy landscape.
With Dangote’s refinery blazing new trails, Europe must now adapt to this monumental shift as Africa steps into a more dominant role in the global oil economy.
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