OPEC (Organization of Petroleum Exporting Countries) recently revealed that Nigeria’s Dangote Refinery is set to significantly impact Europe’s oil industry, particularly in Northwestern Europe. The continent’s traditional diesel and jet fuel suppliers may face increased pressure due to this major new player.
The Dangote Refinery, Africa’s largest, located in Lagos, Nigeria, is poised to disrupt established markets for refined petroleum products in Europe. OPEC has highlighted the refinery as a key figure not only among African suppliers but also on the global stage. The anticipated rise in production levels from Dangote, combined with robust flows from the Middle East and new supplies from Mexico’s Olmeca refinery, is expected to challenge Europe’s reliance on traditional sources. OPEC has stated, “Production levels from Nigeria’s Dangote refinery, coupled with strong flows from the Middle East and new supplies from the Mexican Olmeca refinery, will likely exert pressure on NWE gasoil performance in the mid-term.”
Owned by Africa’s richest man, Aliko Dangote, the refinery began operations in January 2024. It has quickly made its mark on global oil flows. Standard & Poor’s Global has noted that the refinery’s full capacity could reshape international crude markets, stating, “Nigeria’s $20 billion Dangote refinery would shake up international crude flows when it reaches full capacity, having already made an impact since coming online in January.”
The refinery recently achieved a milestone with its first successful export of jet fuel to Europe. Edwin, Vice President of Dangote Refinery, reported, “From the start of production, more than 3.5 billion litres, which represents 90 percent of our production, have been exported.” Additionally, BP is transporting its first jet fuel cargo to Rotterdam from Dangote, after winning part of a 120,000 metric tonnes tender for the end of May, according to S&P Global.
Despite potential challenges, OPEC views the Dangote Refinery as a transformative force in the global oil market, anticipating its significant impact on international energy dynamics.
