August 9, 2024
Nigeria’s $20 billion Dangote refinery has been listed among the top Diesel and jet fuel suppliers that will disrupt Europe’s oil and gas Industry.
This was contained in Organisation of Petroleum Exporting Countries OPEC newly released monthly Oil Market Report for June 2024 a development experts believed will positively impact the Nigerian economy.
OPEC, said supplies from the Nigeria-based world’s largest single-train Dangote Refinery and Petrochemicals will put pressure on the performance of the European oil industry, especially the Northwest Europe Gasoil.
The Standard & Poor Global quoting trading and the ship tracking sources had earlier predicted that Dangote refinery would shake up international crude flows when it reaches full capacity, having already made an impact since coming online in January.
The OPEC report revealed that “Upside potential for higher 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 Northwest Europe Gasoil performance in the mid-term.
It further stated that: “Europe is one of the world’s largest purchasers of refined petroleum products and relied on imports from Asia and the US after the European Union banned the use of Russian diesel in the bloc.”
However, the 650,000bpd capacity Dangote refinery, is eyeing the wider European market after International Oil Companies stopped supplying its crude oil.
Vice President of Oil and Gas at Dangote Industries Limited, Devakumar Edwin, announced that the company had earlier exported its first jet fuel cargo to Europe as it rapidly scales production.
The refinery is said to have exported 90 percent of its 3.5 billion litres of jet fuel and diesel to Europe over alleged lack of support from the Nigerian government.
“It is good to note that from the start of production, more than 3.5 billion litres, which represents 90 percent of our production, have been exported,” Edwin said
BP is currently transporting its first jet fuel cargo to Rotterdam from Dangote, after being awarded part of a 120,000 metric tonnes tender offered for the end of May, according to S&P Global.
OPEC stated that, “In June, the jet/kerosene crack spread in Rotterdam against Brent showed a slight decline, influenced by supply-side dynamics. Despite signs of improving air travel activities, subdued jet fuel demand from the aviation sector weighed on the product market
As expected, European jet/kerosene demand will see upward pressure as consumption levels from the aviation sector continue to pick up in the months ahead.”
S&P had noted that Dangote Refinery in its first six months, scaled to 400,000 b/d and delivered diesel, jet fuel, naphtha, and fuel oil to both domestic and export markets, with Gasoline, Nigeria’s primary fuel type, is expected to be produced from mid-August.
