In a striking reversal of energy flows, Indian refiners are increasing purchases of Nigerian crude while Nigeria’s own $20bn Dangote Refinery relies heavily on US oil imports—highlighting the complexities of global oil markets.
Key Developments:
✔ India’s Nigerian Crude Rush:
- Indian Oil Corp bought 1M barrels of Agbami crude for September
- BPCL secured 2M barrels of Nigerian oil for Sept-Oct deliveries
- Shift comes as US pressures India to reduce Russian imports
✔ Dangote’s US Dependence:
- 60% of July intake (370,000 bpd) was US crude
- Only 40% sourced domestically (Amenam, Bonny Light, Escravos)
- Refinery operating at 85% capacity, targeting 700,000 bpd
✔ Why the Switch?
- Cheaper WTI prices vs. Nigerian grades
- Domestic supply challenges under Nigeria’s crude-for-naira deal
- Mechanical issues delaying full operational capacity (Q4 2026 expected)
Why This Matters
• Energy Security: Raises questions over Nigeria’s refining self-sufficiency
• Economic Impact: Dangote’s gasoline exports (1M tonnes in 50 days) boost forex earnings
• Geopolitical Shift: US gains market share in Africa’s largest refinery
What Next?
→ Dangote’s Expansion: Plans to hit 700,000 bpd (46% gasoline yield)
→ Nigerian Upstream Growth: Local firms like Seplat, Conoil ramp up production
→ Market Watch: Will Nigerian crude flow back to Dangote if prices adjust?
