Roads have remained passable due to a lighter rainy season, which is responsible for the stable supply chain.Oil marketers claim that the Dangote Refinery currently provides the majority of the jet fuel used locally.Less than six months after it started production, jet fuel marketers claim that the majority of jet fuel used locally comes from the 650,000 barrels per day Dangote refinery. This information was reported in an Energy Intelligence report.
Report: The Majority Of Domestic Jet Fuel Is Now Supplied By The Dangote Refinery.
Foluso Sobanjo, managing director of Asharami Synergy, told Energy Intelligence this week, “We are already buying from Dangote [now] it is slightly cheaper or at least the same price as imports.” With a market share of more than 20%, the downstream division of Sahara Group is currently Nigeria’s top supplier of aviation fuel.According to Sobango, importers are currently offered a $2–$3 per metric tonne discount on the Dangote jet.
He also mentioned how much more convenient the 10,000–20,000 tonne “coaster” volumes that are regularly available from the plant are.Prices have decreased as the plant has increased output, even though significant amounts of jet fuel from Asia and the Middle East pass directly by the coast of Nigeria en route to Europe. Sources claim that Dangote started selling petrol last month and is currently running at more than 300,000 b/d.
Industry ClarificationThe explanation was provided in response to the Nigerian airline operators’ request that Dangote’s jet fuel be their preferred supplier last week when they approached Aviation Minister Festus Keyamo.Subsequently, the meeting gave rise to reports in the local press that claimed Keyamo had ordered Dangote to become the only domestic jet fuel supplier in the nation.Additionally, Sobanjo refuted local reports claiming that Dangote had begun charging naira for jet fuel locally.
Domestic sales of petrol and diesel shifted to using local currency following a government-mediated agreement that saw Dangote pay naira for Nigerian crude oil.He stated that although the jet is currently sold in US dollars per tonne, this may soon change.Keyamo was also cited as saying, “We can stabilise the price of jet fuel by eliminating the influence of international market fluctuations. Payments will now be made in naira, making it clearer and cheaper.”
Modifying Trade Patterns
Kpler tanker tracking shows that Dangote has exported 1.1 million tonnes (35,000 b/d) of jet since March, when exports began.About 290,000 tonnes of jet were shipped to Europe and 315,000 tonnes to South America; the majority of the jet remained in West Africa.Since September, exports have somewhat decreased in tandem with an increase in domestic sales.According to a calculation by Energy Intelligence, since April, an extra 94,000 tonnes of Dangote jets have been transported to other Nigerian ports, primarily Lagos. Approximately 75% of Dangote Jet production would be sold by sea, with the remaining 25% being loaded onto road tankers that would travel inland, according to a previous suggestion made by the refinery’s management.
Based on calculations by Energy Intelligence, Dangote jet fuel currently accounts for nearly half of fuel used in West Africa and at least two thirds of Nigeria’s jet fuel supply.From 13,000 b/d last year, when they accounted for the entire nation’s supply, to just 5,000 b/d so far in 2024, Nigeria’s imports of jet fuel have drastically decreased. Similarly, in 2023, there were 34,500 billion barrels of jet imports into West Africa; as of now, only 17,900 billion barrels have been imported from outside the region. Based on loading schedules, Dangote jet fuel is destined for the surrounding countries of Benin, Senegal, Togo, the Gambia, and Gabon. The owner of Dangote has said in the past that the facility will eventually generate enough jet fuel to supply all of Africa.
Logistics of Supply
Local fuel distributors had cautioned that Dangote might not be able to address the issue of recurring stock-outs at Abuja’s Nnamdi Azikiwe International Airport, which gets all of its fuel from road tankers. However, according to Sobanjo, “there have been no supply disruptions in Abuja this year.”He credited the less intense rainy season that has kept the roads usable for the stable supply chain.