The Organisation of Petroleum Exporting Countries (OPEC) has raised concerns about the potential effects of Nigeria’s Dangote refinery and Mexico’s Dos Bocas refinery on oil plants in the United States and Europe. This claim is based on the premise that these refineries could significantly impact the market for premium motor spirit (PMS), also known as petrol, which is primarily refined in the U.S. and Europe....For More READ THE FULL STORY▶▶
The Dos Bocas refinery is projected to process approximately 340,000 barrels per day (bpd), enabling Mexico to become self-sufficient in refined petroleum products. Meanwhile, the Dangote refinery boasts a processing capacity of 650,000 bpd, positioning it to meet demand across Nigeria and the West African region.
In its latest 2024 World Oil Outlook 2050, OPEC stated, “New mega-projects are poised to alter the international downstream market. The start-up of the Dangote refinery and the upcoming commercial launch of the Dos Bocas refinery could significantly affect the gasoline market in the Atlantic basin.”
The report further noted that although both regions currently import substantial volumes of gasoline from international markets, this dynamic could shift when these refineries reach full operational capacity. This change may negatively impact refineries in the U.S. and particularly in Europe, where gasoline markets are experiencing stagnation.
OPEC’s report also highlighted the influence of geopolitics on the downstream market and trade dynamics. It explained, “The EU embargo on Russian crude and product exports has altered interregional oil flows, with EU refiners increasing crude oil imports from the U.S. and the Middle East.” Furthermore, imports of non-Russian petroleum products into the EU have surged, particularly from India, the U.S., and the Middle East. New plants in the Middle East, such as those in Jizan, Saudi Arabia, and Duqm, Oman, have also begun exporting diesel to the EU.
Executive Chairman of the African Energy Chamber, NJ Ayuk, emphasized Nigeria’s emerging role in the global trade of middle distillates and light ends. He stated, “The Dangote refinery will soon rival the largest refining sites in the U.S. and is more than 50% larger than Europe’s biggest refinery.” He acknowledged that while ramp-ups at refineries can be complex and prone to delays, the full operation of the Dangote refinery will transform fuel markets in the West African region and alter trade flows in Europe.
“In other words, Nigerian refined products will soon be making their way into Northwest Europe, a region traditionally reliant on exports,” Ayuk added. He also noted that as the Dangote refinery operates at full capacity, there will be a reduction in available crude in the Atlantic basin, particularly impacting Europe.
As these developments unfold, both OPEC and stakeholders in the U.S. and Europe are closely monitoring the implications for the international oil market and the potential shifts in gasoline supply dynamics.….For More READ THE FULL STORY ▶▶
