Following a recent price cut by Africa’s largest petrochemical refinery, the $20.5-billion Dangote Oil Refinery, owned by Aliko Dangote, the continent’s richest person, expectations are rising again as oil marketers anticipate a further decline in diesel prices.
Marketers see room for further reduction
The Independent Petroleum Marketers Association of Nigeria (IPMAN) expects the Dangote refinery to reduce diesel prices further. IPMAN National Vice President Hammed Fashola cited the recent drop from over N1,200 ($1.052) to N1,000 ($0.877) per liter as a positive step. He emphasized IPMAN’s belief that the naira’s rebound against the dollar will contribute to further price reductions.
“Even we are still expecting that diesel will still come down more,” Fashola said. “Because if you look at the dollar rate to the naira now, the currency is doing well against the dollar. He pointed to the absence of factors like shipment costs, taxes, and customs duties, which previously affected prices, as reasons for optimism.
Strategic moves by Dangote Oil Refinery
Alongside its pricing adjustments, Dangote Oil Refinery is ramping up production to meet Nigeria’s energy needs and expand its reach to other countries. The refinery is making strategic moves to adapt to global market dynamics by utilizing U.S. crude oil imports for up to a third of its feedstock.
The 650,000-barrel-a-day refinery is currently operating at full steam, though below its nameplate capacity. It produces jet fuel, gasoil (diesel), and naphtha. Additionally, the complex houses a polypropylene facility with a yearly output of 1 million metric tonnes and two of the largest fertilizer trains with a combined annual urea capacity of 3 million tonnes.
Dangote: A key player in energy independence
Despite operating at roughly 300,000 barrels per day, nearly half its capacity, the refinery plans to expand its product offerings soon. These developments position Aliko Dangote, Africa’s wealthiest individual with a net worth of $16.5 billion according to Bloomberg, as a key player in Nigeria’s journey towards energy independence.
The price reductions and production ramp-up highlight Dangote’s strategic vision and commitment to shaping Nigeria’s energy landscape. As the Dangote Oil Refinery continues to make waves in the energy sector, stakeholders eagerly await further developments, anticipating both economic and industrial impacts across Nigeria and beyond.
