Oil Market: Why Nigeria Might Reduce Raw Material Exports.

Refinery Near Lagos Increases Domestic Demand for Oil

A giant refinery located near Lagos plans to process 24 million barrels of Nigerian supplies in October and November as it increasingly turns to local raw materials, according to the cargo allocation list.

The Dangote plant, which aims to end the export of crude oil from Nigeria by reducing it, is ahead of schedule by many years. Dangote, with a capacity of 650 thousand barrels per day, is the largest plant in Africa and Europe and will require 13-14 shipments from Nigeria's average monthly program, which consists of approximately 50 cargoes.

Analysts determine that the West African crude oil market in the fourth quarter will become tighter due to the implementation of Dangote. Several shipments may not be delivered on Time as planned, and in October, the list included two cargoes deferred from September. However, the planned volume significantly exceeds the average daily outputs of Dangote during the first half of the year as the plant gradually increased production.

According to traders, Dangote is also reducing purchases of American oil. Earlier this year, the refinery imported millions of barrels of WTI Midland until it resold them and reduced purchases.

Last week, Nigerian National Petroleum Co. signed a deal with Dangote, under which the state oil company will supply oil, and it will become the sole distributor of the essential gasoline produced at the refinery.

If Dangote's expansion continues in the coming months, Nigeria may achieve its long-standing goal of limiting the import of expensive petroleum products.