In a report released on Wednesday, the Organisation of the Petroleum Exporting Countries, OPEC, announced that the Dangote Petroleum Refinery and its efforts to ramp up Premium Motor Spirit (petrol) production are drastically impacting European PMS markets.
Before Dangote refinery began production of PMS last September, Nigeria had relied solely on importation for its energy needs. But since it started production, the refinery has not only been feeding the local market, it has also been exporting petrol, diesel, and aviation fuel to other countries within and outside Africa.
This has drastically reduced the importation of petroleum products from Europe to Nigeria
“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,” the report stated.
“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.”
In the report, OPEC referenced the last quarter of 2024, declaring that “imports also declined, particularly oil product imports, improving the outlook for the external sector.”
Although gasoline inventories at the Amsterdam-Rotterdam-Antwerp storage hub remained high, the gasoline crack spread in Rotterdam against Brent increased slightly on healthy export.
It added that the gasoline inventory builds are expected to extend into the February 2025 amid a lengthening gasoline balance in the Atlantic Basin due to winter-season demand-side pressures.
OPEC maintained that the ongoing recovery in gasoline refinery output levels will likely exacerbate the already bearish market sentiment.
Meanwhile, according to data OPEC got from secondary sources, the Monthly Oil Market Report disclosed that the average daily crude production in Nigeria hit 1.507 million barrels in December. It rose by 12,000bpd from 1.477mbpd in November.
However, the figure supplied by the government was 1.485mbpd for December. This aligns with that of the Nigerian Upstream Petroleum Regulatory Commission.
Data compiled by Bloomberg indicates that Dangote refinery ranks above the 10 biggest refineries in Europe because of its capacity.
