Dangote Petroleum Refinery and Petrochemical is gaining traction in the diesel market due to specification modifications and the market effects of the Russia-Ukraine war.

The move by Nigeria to cut the maximum sulfur content for gas oil imports from 3,000 parts per million to below 500 parts per million has stifled import of the product from Europe to Nigeria and made diesel from Dangote Refinery viable, according to S&P Global Commodity Insights.

“ In West African gas oil, there was a recent spec change by Nigeria, which cut the maximum sulfur content for gas oil imports (diesel) from 3,000 parts per million to below 500 parts per million. And this saw a really significant reshuffle in the market,” Matthew Tracey-Cook, analyst at S&P Global Commodity Insights said.

He noted that “Russia has completely cut off exports to West Africa, which saw some other regions that we haven’t previously seen exporting take some space in the total export pool”.

“So the Mediterranean, specifically Spain, has been taking a larger role in Europe, exporting gasoline into Nigeria in particular,” Tracey-Cook said.

Dangote refinery recently announced a price reduction of automotive gas oil (diesel) to N1,000 per litre, a move attributed to more lenient quality controls.

The report highlighted that the refinery’s diesel supplies have a sulphur content of around 650 parts per million (ppm), exceeding the 200 ppm cap enforced by the Nigerian Midstream and Downstream Petroleum Regulatory Authority on imported products since March.

“By permitting Dangote to sell diesel above the 200 ppm sulfur cap, the regulator has provided a route to market for early supplies from the refinery ahead of secondary unit start-ups for gasoline and low-sulfur diesel, deflating local fuel prices and clawing back revenue for the project,” the report said.

According to the analysts quoted in the report, the “refiner announced intentions to supply products conforming to Euro 5 specifications (10ppm diesel), but its low sulfur diesel production remains contingent on the start-up of its key distillate hydrocracker unit”.

S&P Global said the refiner has been pressured to alleviate surging fuel import costs amid the rapid depreciation of the naira, “which has seen diesel prices nearly double year on year”.

“While the price of gasoline has remained comparatively stable thanks to suspected government subsidies, concerns of a rising debt burden have added pressure to accelerate supplies from the refinery,” the report said.

According to the publication, neither Dangote nor the NMDPRA could be reached for comment regarding the quality of supply from the refinery or the permitted sulphur cap.

S&P Global noted that the increased availability of cheap Dangote diesel has heightened uncertainty surrounding diesel flows into West Africa, as traders grapple with rapid specification changes.

“Last month, high sulfur gasoil flows were dramatically reshaped by new Nigerian import requirements reducing sulfur limits from 0.3 percent (3,000 ppm) to 200 ppm, while officials have hinted at further reductions,” S&P Global said.

“Meanwhile, it remains unclear whether Dangote will reduce the sulfur content of its domestic diesel supplies, or if imports will consistently be held to higher quality standards.”

According to the report, a diesel trader said the market is currently distorted due to Dangote’s volumes, noting the emerging mismatch.

S&P Global said early diesel specs from Dangote, described as “inconsistent” by one trader, highlight aggressive timeframes by the refiner and considerable outage risks.

https://businessday.ng/news/article/dangote-refinery-gets-market-edge-on-spec-changes-stranded-russian-diesel/

Well done Dangote, let the brainless supporters of agnado keep waiting for you to reduce fuel prices, after US and Russia, please do business with China too.

After all you're a private businessman.

It is well.

See how by a single maneuver, the government has effectively secured the Nigerian diesel market for Dangote.

That's a knock out punch against most European diesel imports.

Fear Government power o.

For those who don't understand, Dangote's diesel is superior quality and more expensive that the junk diesel that is usually imported from Europe.

This government policy means only diesel of a higher quality can be imported. That type will be too expensive if imported.

So, now, Dangote and other local refineries will have a better chance of capturing the Nigerian market.

Dangote rubbed the back of the government by reducing its diesel price, now the government is rubbing Dangote's back in return.

Win win for Dangote and Nigeria.

successmatters:
Well done Dangote, let the brainless supporters of agnado keep waiting for you to reduce fuel prices, after US and Russia, please do business with China too.

After all you're a private businessman.

Shameless. The same folks who said the refinery will never start.

After reading this piece twice, I beg to say the author has virtually not communicated anything.
Just joining words together, no communication.

Write up full of meaningless jargons:
'going traction ','West Africa gas-oil', "Market reshuffle" ', prices double year on year' etc

No offence, but my candid opinion.

ElSudani:


Shameless. The same folks who said the refinery will never start.

Have it started?

How many fuel did you buy there.

successmatters:


Have it started?

How many fuel did you buy there.

Do I need to buy fuel there before you believe they have started producing?
What type of reasoning is that?

ElSudani:
Do I need to buy fuel there before you believe they have started producing?
What type of reasoning is that?

But you need to collect money from innocent people before you answer agbero right?

successmatters:


But you need to collect money from innocent people before you answer agbero right?

Folks like you continue to dumb down this forum with very low level thinking.

The government is helping local refiners. So far the diesel is produce in Nigeria, the government won't mind about the quality.

Importing diesel will become expensive

Global oil price will go up.

All those senseless wars are deliberate..

The more the war, the more weapons sale and in particular sending aids in billions of dollars which are never in cash even though there are millions of homeless Americans to take care of

Nov 2024 things

Dangote is the new king of Diesel in West Africa,the figures coming out from the Refinery is proving it everyday

pharmagba:
After reading this piece twice, I beg to say the author has virtually not communicated anything.
Just joining words together, no communication.

Write up full of meaningless jargons:
'going traction ','West Africa gas-oil', "Market reshuffle" ', prices double year on year' etc

No offence, but my candid opinion.

I totally agree with this commentator, I read the whole thing twice and I am really grappling to understand the whole thing,let me summarise what I feel they are trying to communicate,the Diesel market has been distorted by Dangote Refinery
Some countries that used to supply Diesel to the West African Coast are not sure what to do and are now claiming Dangote Refinery Diesel falls below the standard accepted for Nigeria
My people, there is fire on the mountain..... I keep saying that the Day Nigeria rises the whole world will take notice, and we have just began

helinues:
Global oil price will go up.

All those senseless wars are deliberate..

The more the war, the more weapons sale and in particular sending aids in billions of dollars which are never in cash even though there are millions of homeless Americans to take care of

Nov 2024 things

Shatap

I keep saying this White people will fight back at this Refinery Project.
The Summary of the Article is thus, the Regulatory Agency told the Europeans that their Diesel was injurious for Nigeria,the White people were still trying to figure out how to meet up with the specifications from the Nigerian Authority when AlH Dangote released million of Litres into the Market.
Now the Europeans are complaining the Diesel from Dangote Refinery is below the Specifications from the Nigerian Government.
The moral of the Story, Everyone is fighting for themself, Nigeria must do all it can to protect the Refinery.
The Europeans are stuck with millions of liters of Fuel without anywhere to take it, let us remember this is just Diesel and Aviation fuel,by the Time the Refinery starts pumping out Petrol I'm sure this Bloody Europeans will introduce price gouging,they will try what they did with Air Peace,reduce the price to put the Refinery out of Business.
Never again will Nigeria be at the mercy of any European or Western Nation for it's Energy needs.
Seriously God loves Nigeria
God bless Nigeria.

DeLaRue:
See how by a single maneuver, the government has effectively secured the Nigerian diesel market for Dangote.

That's a knock out punch against most European diesel imports.

Fear Government power o.

For those who don't understand, Dangote's diesel is superior quality and more expensive that the junk diesel that is usually imported from Europe.

This government policy means only diesel of a higher quality can be imported. That type will be too expensive if imported.

So, now, Dangote and other local refineries will have a better chance of capturing the Nigerian market.

Dangote rubbed the back of the government by reducing its diesel price, now the government is rubbing Dangote's back in return.

Win win for Dangote and Nigeria.

Administration of Nigeria is in the hands of capable, brilliant, competent and patriotic Nigerians

successmatters:


Have it started?

How many fuel did you buy there.

It only a dummy would think a person would take gallons to buy diesel at the refinery?

successmatters:
Well done Dangote, let the brainless supporters of agnado keep waiting for you to reduce fuel prices, after US and Russia, please do business with China too.

After all you're a private businessman.

Reta**Ed soul, same pple saying dangote refinery was a sham....

ElSudani:
Do I need to buy fuel there before you believe they have started producing?
What type of reasoning is that?

Do you think they are called headless mobs for no reason

Awesome