As tensions in the Middle East cause global oil prices to fluctuate, Nigeria, Africa's leading crude oil producer, can count on the Dangote refinery to ensure the availability of petrol and diesel throughout the country. The mega-plant in Lekki, with a capacity of 650,000 barrels per day, is operating at full capacity and even announced a significant drop in ex-warehouse prices on Tuesday 10 March.
The refinery, owned by Nigerian billionaire Aliko Dangote, has reduced the price of petrol to 1,075 naira per litre (down from 1,175 naira previously) and diesel to 1,430 naira per litre (a reduction of 190 naira). These adjustments, in line with the easing of tensions on the international crude oil market, come amid a tense geopolitical climate that usually exposes the country to risks of shortages and price spikes.
"Given the volatility of prices, the Dangote refinery is our salvation," said Billy Gillis-Harry, president of the Petroleum Traders Association of Nigeria (PETROAN). He insists: "The availability of fuel is much more important than its price!"
The refinery's new director, David Bird, confirmed at a press conference earlier this week that the plant was operating "at full capacity". However, he pointed to administrative red tape: no fewer than 47 government agencies impose regulatory costs which, he said, ultimately affect prices at the pump.
The Dangote Group is once again calling for priority access to Nigerian crude oil for local refineries. Even today, part of the supply must be purchased in dollars on the international market, which increases dependence on global price fluctuations and exchange rates.
For Nigeria, which exports crude oil but traditionally imports almost all of its refined products, the ramp-up of this 650,000-barrel-per-day facility marks a strategic turning point. Not only does it mitigate the effects of the war in the Middle East, but it also strengthens the energy sovereignty of Africa's most populous country.
With this sustained local production, Nigerian authorities and distributors now hope to stabilise prices at the pump and avoid the chronic queues at petrol stations that have long been a daily occurrence for motorists.