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OPEC Says Dangote Refinery’s Diesel, Jet Fuel Supplies To Disrupt Europe’s Oil & Gas Industry 

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  • It is a big plus to Nigeria’s economy

 

The Organisation of Petroleum Exporting Countries, OPEC, has said supplies from Nigeria-based world’s largest single-train Dangote Refinery and Petrochemicals will put pressure on the performance of Europe’s oil industry, especially the Northwest Europe (NWE) Gasoil.

OPEC in its newly released monthly Oil Market Report for June 2024 listed Dangote Refinery among the top Diesel and jet Fuel suppliers that will disrupt Europe’s oil & gas Industry, a development experts forecasted will positively impact the Nigerian economy.

It would be recalled that Standard & Poor Global quoting trading and the ship tracking sources had earlier predicted that 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, trading sources and ship tracking data show.

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 NWE gasoil performance in the mid-term.”

It stated further “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 refinery which is owned by the Africa’s richest man, Aliko Dangote, 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 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.

“Going forward, European jet/kerosene demand is expected to see upward pressure as consumption levels from the aviation sector continue to pick up in the coming months.”

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, being expected to be produced from mid-August.

Notwithstanding, the refinery has already affected crude flows, with dozens of Nigerian cargoes remaining in-country and US WTI Midland, a comparable light, sweet grade, being imported.

The mega-refinery could therefore tighten the light, sweet crude market. “Its diet is WTI and the lighter Nigerian [crudes] so if you were chasing those barrels you’d probably feel it quite keenly,” a West African crude trader told Commodity Insights. “Once they get to 650,000 b/d without any WTI Midland, ‘severely disrupted’ [will be] the headline.”

WTI Midland crude initially emerged as the favored feedstock to supplement Nigerian supply, with the refinery signing long-term supply contracts for the US grade and noting its competitive pricing. Platyts, part of Commodity Insights, last assessed WTI Midland into Rotterdam at $82.36/b on July 31, while Nigeria’s Bonny Light was assessed at $82.80/b on the same day.

Crude flows in and out of the Dangote refinery have been felt in other markets, especially in Europe, the largest consumer of light, sweet Nigerian crude. The US grade has accounted for 30% of crude delivered to Dangote, through 18 cargoes.

President of Dangote Group, Aliko Dangote said the facility would broaden its feedstock sources with Libyan, Angolan, and Brazilian crude.

“The refinery was built to use Nigerian crude and add value to it within Nigeria. Why should we deviate from that focus?” said Dangote, adding that the crude supply issues were “getting resolved”, but that the refinery remained open to all opportunities “to supplement it”.

“Dangote refinery is designed to process a range of light and medium grades of crude oil, including Nigerian grades,” said Rasool Barouni, Associate Director and head of Refining at S&P Global Commodity Insights. “Other similar grades including other WAF grades could be an option.”

Nigeria is sub-Saharan Africa’s largest oil producer, pumping 1.5 million b/d in June, according to the Platts OPEC Survey from S&P Global Commodity Insights. Until this year, all of its oil was exported due to the lack of refining capacity, with gasoline, diesel, and jet fuel imported for domestic use.

BIG STORY

JUST IN: Chaos At PDP Caucus Meeting As Security Operatives Forcefully Eject Members [VIDEO]

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The caucus meeting of the Peoples Democratic Party (PDP) turned chaotic on Monday after security operatives forcefully removed some members from the national executive committee (NEC) hall.

The meeting was scheduled to take place at the NEC hall of the party’s headquarters in Abuja, with members already arriving at the venue.

Two individuals were ejected by security personnel following claims by some protocol officers that they had no authorization to be present at the meeting.

During the confrontation, a glass door was broken while the members were being dragged out.

“Are you NWC member?” shouted Chinwe Nnorom, national director of publicity, before the individuals were taken out of the venue.

Earlier in the day, security personnel had taken control of the PDP headquarters and stopped members of the board of trustees (BoT) from accessing the NEC hall for their scheduled meeting.

As a result, the BoT moved their meeting to the Yar’Adua Centre located in the central business district of Abuja.

In recent weeks, the PDP has been embroiled in increasing drama and new developments amid its internal crisis.

Watch VIDEO HERE

 

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BIG STORY

BREAKING: Security Operatives Block PDP BoT From Meeting At Party Headquarters

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Security operatives have barred members of the Peoples Democratic Party (PDP) Board of Trustees (BoT) from holding their meeting at the party’s national headquarters in Abuja.

The security personnel stopped the BoT members from accessing the National Executive Committee (NEC) hall where the meeting was scheduled to take place on Monday morning.

The BoT has subsequently relocated the meeting to the Yar’Adua Centre in Abuja’s Central Business District.

 

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BIG STORY

Nigerian Medical Student Hails “Inspiring” Encounter With President Tinubu, St. Lucian PM Pierre

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For Nigerian medical student Bob Chikwem Amadi, what started as a routine work assignment turned into an unforgettable experience with two world leaders — President Bola Ahmed Tinubu of Nigeria and Prime Minister Philip J. Pierre of Saint Lucia.

Amadi, currently studying medicine at the American International University in Saint Lucia, was part of the service team present during President Tinubu’s courtesy call to Prime Minister Pierre’s official residence on the second day of the Nigerian president’s state visit to the Caribbean nation.

Originally from Rivers State, Amadi has lived in Saint Lucia for ten years and recently completed the four-year basic phase of his medical education. He is now preparing to begin his clinical training.

Alongside his studies, Amadi also works part-time as a talent and brand manager with a local catering and entertainment company — a role that brought him close to the high-level diplomatic event.

During the visit, Prime Minister Pierre was informed by his aides that one of the staff members was a Nigerian student.

Taking a brief moment before his official engagements began, the prime minister introduced Amadi to President Tinubu.

The president, known for his engaging nature and interest in Nigerians living abroad, took time to speak with the young student, asking about his name, background, and academic journey.

Tinubu extended his best wishes and words of encouragement, praising Amadi for his dedication to his studies overseas.

Describing the experience, Amadi said it was “an inspiring moment” for him.

“Saint Lucia is an amazing island. I will describe it as a wonderful place. They are a very contented society and things are relatively calm”, he said.

The moment was capped off when Amadi was invited to join President Tinubu and Prime Minister Pierre for a group photograph — a symbolic and memorable close to a chance meeting with two major political leaders from Africa and the Caribbean.

Amadi also reflected on the strong historical and cultural ties between Nigeria and Saint Lucia.

“We have always hoped that there are many opportunities between Saint Lucia and Nigeria. We share similar food crops and culture, and the connection is deep”, he said.

President Tinubu’s visit to Saint Lucia marks the beginning of a broader diplomatic tour of the Caribbean and South America, focused on enhancing trade, cultural ties, and diplomatic collaboration between Nigeria and Caribbean countries.

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