Dangote refinery petrol production affecting European markets – OPEC

The Organisation of the Petroleum Exporting Countries (OPEC) has highlighted the impact of the Dangote Petroleum Refinery on the Premium Motor Spirit (PMS) market in Europe.
The 650,000-barrel-per-day Dangote refinery, which began operations in January last year, started producing PMS in September, marking a significant shift after Nigeria had relied solely on imports for its fuel needs for years. Since its production launch, the refinery has been exporting petrol, diesel, and aviation fuel to countries across Africa and beyond.
In a report released on Wednesday, OPEC noted that the emergence of the Dangote refinery has led to a reduction in the importation of petroleum products from Europe to Nigeria.
“The ongoing operational ramp-up efforts at Nigeria’s new Dangote refinery and its gasoline (petrol) exports to the international market will likely weigh further on the European gasoline market.
“Continued gasoline production in Nigeria, a country that has relied heavily on imports to meet its domestic fuel needs in the past, will most likely continue to free up gasoline volumes in international markets which will call for new destinations and flow adjustments for the extra volumes going forward.”
In the last quarter of 2024, OPEC said “imports also declined, particularly oil product imports, improving the outlook for the external sector.”
The report indicated that the gasoline crack spread in Rotterdam against Brent crude saw a slight increase due to strong exports, although gasoline inventories at the Amsterdam-Rotterdam-Antwerp (ARA) storage hub remained elevated. It was also noted that gasoline inventory builds are expected to continue into the next month, driven by the lengthening gasoline balance in the Atlantic Basin as a result of winter-season demand-side pressures. OPEC suggested that the ongoing recovery in gasoline refinery output could worsen the already bearish market sentiment.
Additionally, the Monthly Oil Market Report revealed that Nigeria’s average daily crude production reached 1.507 million barrels in December, according to data from OPEC’s secondary sources. This marked a slight increase of 12,000 barrels per day from the 1.477 million barrels per day reported in November. The government’s figure for December was 1.485 million barrels per day, consistent with data from the Nigerian Upstream Petroleum Regulatory Commission.
The report also highlighted that the Dangote refinery, with a capacity of 650,000 barrels per day, ranks above the top 10 largest refineries in Europe, according to Bloomberg data. The $20 billion Dangote refinery can process 246,000 barrels more per day than Shell’s Pernis refinery in the Netherlands, which has a capacity of 404,000 barrels per day, the largest in Europe. Other notable refineries in Europe include BP’s Rotterdam facility with a 380,000-barrel capacity, the GOI Energy ISAB refinery in Italy at 360,000 barrels per day, and TotalEnergies’ Antwerp refinery in Belgium with a capacity of 338,000 barrels per day.
Other refineries listed in the report include Orlen Plock in Poland (327,000 barrels per day), Shell’s Rheinland refinery in Germany (327,000 barrels per day), Miro refinery in Germany (310,000 barrels per day), and ExxonMobil’s Antwerp refinery in Belgium (307,000 barrels per day).