The Organisation of the Petroleum Exporting Countries has noted that the Dangote Petroleum Refinery is significantly influencing the Premium Motor Spirit market in Europe.
Since commencing operations in January 2024, the 650,000-barrel capacity Dangote refinery began producing PMS in September, marking a pivotal shift for Nigeria, which had previously relied solely on fuel imports.
The refinery has since exported petrol, diesel, and aviation fuel to several countries within and beyond Africa.
OPEC’s recent report highlighted that the operations at the Dangote refinery are reducing Nigeria’s dependency on European petroleum product imports.
The report elaborated, “The ongoing operational ramp-up efforts at Nigeria’s new Dangote refinery and its gasoline (petrol) exports to the international market will likely weigh further on the European gasoline market.”
It added, “Continued gasoline production in Nigeria, a country that has relied heavily on imports to meet its domestic fuel needs in the past, will most likely continue to free up gasoline volumes in international markets which will call for new destinations and flow adjustments for the extra volumes going forward.”
Furthermore, the report noted a reduction in imports in the last quarter of 2024, particularly oil product imports, which have improved the outlook for Nigeria’s external sector.
Despite high gasoline inventories at the Amsterdam-Rotterdam-Antwerp storage hub, the report revealed that the gasoline crack spread in Rotterdam against Brent slightly increased due to strong exports.
However, with the winter season demand-side pressures, the build-up in gasoline inventory is expected to persist.
OPEC also indicated that the increase in gasoline refinery output could contribute to a bearish sentiment in the market.
Meanwhile, the Monthly Oil Market Report showed that Nigeria’s average daily crude production reached 1.507 million barrels in December, an increase of 12,000 barrels per day from November’s 1.477 million barrels per day.
This figure aligns with the Nigerian Upstream Petroleum Regulatory Commission’s data, which indicated 1.485 million barrels per day.
The Dangote refinery’s size places it among the largest in Europe. The $20 billion facility can refine 650,000 barrels of petroleum products daily, surpassing some of Europe’s biggest refineries.
According to Bloomberg, the Dangote refinery exceeds the capacity of Shell’s Pernis refinery in the Netherlands, which can process 404,000 barrels per day. Other notable refineries include BP’s Rotterdam refinery (380,000 barrels), GOI Energy ISAB refinery in Italy (360,000 barrels), and TotalEnergies’ Antwerp facility in Belgium (338,000 barrels), among others.
This growth in Dangote’s refining capacity is set to reshape global fuel trade dynamics.
