Nigeria is better placed to withstand fuel supply disruptions caused by the ongoing global oil market crisis, thanks to increased domestic refining capacity, the Chief Executive Officer and Managing Director of Dangote Petroleum Refinery, David Bird, has said.
Speaking during a media engagement, Bird noted that local refining has strengthened the country’s energy security, reducing its vulnerability to international supply shocks that often result in fuel shortages and long queues.
According to him, while many import-dependent countries are expected to feel the impact of the current global oil crisis more severely, Nigeria’s ability to refine petroleum products locally provides a critical buffer against supply disruptions.
He explained that despite operating under the crude-for-naira arrangement, the refinery purchases Nigerian crude oil at international benchmark prices and does not benefit from discounted crude supplies.
As a result, the refinery remains exposed to fluctuations in global crude prices as well as rising freight, insurance and financing costs.
Bird disclosed that global oil markets have witnessed significant volatility in recent weeks, with crude prices climbing from the mid-$60 range to nearly $120 per barrel within a week.
He added that shipping costs have also surged sharply, with tanker freight rates increasing from about $800,000 to roughly $3.5 million per shipment.
Despite the challenging market conditions, the Dangote Refinery continues to operate at its full nameplate capacity of approximately 650,000 barrels per day, with the potential to increase production to around 700,000 barrels daily.
Bird maintained that Nigeria’s growing domestic refining capacity will play a key role in ensuring a stable supply of petroleum products, even as uncertainty persists in the global energy market.
CREDIT: MAVIS FANTEVI
