Dangote refinery gets only half of needed crude oil, cheaper fuel still far off
By Aboki Forex —
The Dangote Refinery is struggling to get enough crude oil to run at full capacity. This means cheaper fuel for Nigerians may not come anytime soon.
The refinery needs about 13 crude cargoes every month to operate efficiently. But it currently receives only five cargoes from the Nigerian National Petroleum Company Limited. That is a gap of eight shipments, or roughly 62% of its needs. The plant is now running at about one-third of its 700,000 barrels per day capacity.
A report from the African Energy Council says the problem is not that Nigeria lacks crude oil. The issue is how the supply system is structured. Competing interests within the chain may be affecting the flow of crude. This is especially true where the same state-linked entity acts as both a supplier and a competitor in the downstream market.
The think tank linked the dispute between the refinery and key federal institutions to broader governance problems. It called the situation a stress test for the Petroleum Industry Act 2021. That law was meant to encourage local refining and stabilise the fuel market.
Data from the Nigerian Midstream and Downstream Petroleum Regulatory Authority shows crude deliveries to local refineries fell in May. This has raised concerns about fuel production and market stability. Analysts say the unclear separation between regulatory and commercial roles in the sector continues to hurt investor confidence.