Africa’s biggest refiner may soon be allowed to set its own petrol prices

Nigeria may soon let its new refinery, Africa’s biggest crude processing unit, set the price of the gasoline it sells to marketers in a major shake-up of policy controls on fuel prices, officials familiar with the matter said on Thursday. plans for Bloomberg.

From next month, the Dangote refinery – which does not yet produce gasoline – could start setting the price of the fuel it sells to marketers, according to Bloomberg’s unnamed sources.

Nigeria has so far imported all the petrol it consumes. The government subsidized the price of fuel, at a huge budget expense.

The Dangote refinery is set to start producing gasoline soon, which could change global gasoline flows.

The newly operational refinery is poised to transform OPEC’s largest African crude producer from a gasoline importer to a gasoline exporter, impacting the balance of the fuel market, particularly in Europe.

The Dangote Refinery began fuel production in January 2024, marking the commissioning of the plant that had experienced years of delays.

The facility has not yet started producing gasoline, but is on track to produce large volumes of the fuel, sources familiar with the operations told Bloomberg on Monday.

The refinery, which has a processing capacity of 650,000 barrels per day (bpd), will meet 100% of Nigeria’s demand for all refined petroleum products and will also have a surplus of each for export.

Once the refinery is fully operational sometime in 2025, more than half of its processing capacity is expected to be devoted to gasoline production.

In mid-June, Dangote Group chairman Aliko Dangote said the refinery was delaying the start of gasoline deliveries beyond mid-July.

At the time, Dangote, Africa’s richest man, said the refinery would be able to bring petrol to market by the third week of July.

That timeline has slipped, and most industry analysts expect considerable volumes of Nigerian gasoline to hit international markets next year.

By Charles Kennedy for Oilprice.com

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