Africa’s largest oil refinery is sounding the alarm — and making a promise. As Brent crude surged past $119 per barrel on Monday, Dangote Refinery CEO David Bird stepped before cameras in Lagos to assure a jittery Nigerian public that fuel supplies will not run dry, even as freight costs for importing crude have quadrupled almost overnight.
Brent crude, which was trading at $70 a barrel just ten days ago, rocketed to $119.50 in early trade Monday — a level last seen in mid-2022. The dramatic spike has sent shockwaves through global energy markets and sparked panic buying in countries such as the United Kingdom and Australia, while China, which relies heavily on Middle Eastern crude, has banned fuel exports to protect domestic supply.
For Dangote, the price surge has immediate operational consequences. The refinery sources part of its crude from the United States and Brazil, and Bird revealed that daily tanker freight costs have ballooned from $800,000 to $3.5 million. In response, the refinery has already raised its gantry price of petrol twice in the past week — a cumulative increase of 28.6 percent, bringing the pump price to N994 per litre.
Despite this, Bird pledged that domestic supply would remain the refinery’s top priority. “We will prioritise domestic supply and continue to ensure that Nigeria enjoys what it has enjoyed only for the last 18 months, two years — fuel abundance and not fuel scarcity,” he said. The 650,000-barrel-per-day refinery is currently running at full capacity.
Economists warn that the broad fallout from surging fuel prices could erode Nigeria’s recent disinflation gains and put a premature end to the interest rate easing cycle that only began last month. Bird called on the Nigerian Government and NNPC Limited to ensure the refinery continues to have access to Nigerian crude grades, which he described as critical to sustaining uninterrupted domestic supply.
Source: Premium Times Nigeria