Dangote Refinery Buys Algeria’s Saharan Crude Oil After Crashing Petrol Prices
- The Dangote Refinery is set to receive about one million barrels of the Algerian Sarahan Blend Crude
- The consignment is reportedly due to arrive in March as the refinery begins preparations to ramp up production
- Reports say oil tankers loading in Algeria did not show Africa as their destination, meaning the shipment will arrive next month
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Legit.ng’s Pascal Oparada has reported on tech, energy, stocks, investment and the economy for over a decade.
The Dangote Refinery has bought its first consignment of Algeria’s light sweet Saharan blend crude.
The giant refinery reportedly bought one million barrels of cargo from Glencore, the trading firm, this week, with the consignment due to arrive in March.
Source: UGC
Dangote Refinery to receive the consignment in March
Reports say the deal was not immediately confirmed by either party and the purchase price remains unknown.
According to reports, none of the tankers loaded in Algeria in February showed Africa as their destination, meaning the shipment will load in March.
A trader noted that Saharan Blend’s quality is good for the Dangote Refinery and competitively priced relative to Nigerian grades.
Almost 420,000 barrels of crude oil have been delivered to the $20 billion Lekki refinery this year comprising light sweet crude grades.
The expected March loading trade cycle for crude oil slowly kicked off due to sluggish demands in Europe because of seasonal refinery maintenance and a glut in supply.
Refinery owners in Nigeria blame FG for poor supply
Analysts say this may have encouraged European buyers to hold off on purchases of the Algerian oil in hopes of weaker price differentials, which prompted dealers to seek alternative buyers.
Saharan crude prices dipped by $1 this month when March cargoes were loaded and sold at 20 euros per barrel less, relative to the North Sea Date benchmark.
Meanwhile, local refiners in Nigeria have blamed regulators for not meeting domestic petroleum product demands due to poor crude supply.
The Nigerian National Petroleum Company Limited (NNPC) reportedly allocated 450,000 barrels of crude oil to the domestic market, with the mega Dangote Refinery receiving 350,000 barrels daily.
The refinery is gearing up to ramp up production this month, hence the need for more crude oil.
There were speculations that the NNPC planned to cut crude supply to Dangote Refinery due to demand from the local market and following the restarting of the Port Harcourt and Warri refineries.
NNPC denies plans to slash Dangote’s crude supply
However, NNPC denied that it was slashing crude supplies to the 650,000 bpd-capacity refinery.
NNPC spokesman, Olufemi Soneye, exclusively disclosed to Legit.ng earlier this month that there was no plan to slash crude allocation to Dangote Refinery, calling such reports baseless and false.
The Crude Oil Refinery Owners Association of Nigeria (CORAN) has blamed the oil industry for its failure to meet domestic fuel consumption demands.
Legit.ng earlier reported that Nigeria’s petrol consumption dropped from 66 million litres per day to 50 million due to subsidy removal.
The Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) disclosed this recently.
They accused the NMDPRA of preferring to issue petrol import licenses to meet the needs of domestic refiners. Punch quotes CORAN’s publicity secretary, Eche Idoko, as saying that the prolonged absence of oil allocation under the Domestic
Source: UGC
Crude Oil Supply Obligation (DSCSO) guidelines are the reason for the shortfall in petrol supply.
Dangote petrol now cheaper than imported fuel
Legit.ng reported that petroleum products importers have lamented the continued price slash of petrol by the Dangote Refinery.
Some of the importers revealed that dealers said they might be forced to slash their prices after importing at a high cost as consumers would now patronise filling stations selling cheaper fuel.
Dangote Refinery reduced the ex-depot petrol price by N65, down from N890 to N825 per litre.
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Source: Legit.ng
