OPEC's Monthly Oil Market Report highlights that while petrol imports have witnessed a significant decline of 60% compared to the corresponding period in 2023, a noticeable uptick in the volume of PMS imports was observed between September and October 2024.
It is important to mention that several vessels arrived in Nigeria to offload PMS, particularly during a period of disputes between marketers and the Dangote refinery.
Reports indicate that the majority of petrol imports into Nigeria and West Africa during this period originated from Europe.
OPEC, citing Argus, stated, “Gasoline exports to West Africa increased, offsetting a decline in shipments to the US. Exports to Nigeria saw a significant rise compared to September, although they remain 60 percent lower year-on-year.”
The report also highlighted that the PMS crack spread in Rotterdam against Brent increased as European PMS exports rose in October.
Furthermore, additional volumes of European PMS were reportedly sent to Libya and Saudi Arabia during the same month.
OPEC emphasized that the introduction of new product volumes from Nigeria’s Dangote refinery, China’s Yulong petrochemical, and Mexico’s Olmeca refinery is expected to enhance product availability in the market, particularly for gasoline.
Reuters has reported that approximately one-third of Europe’s average petrol exports, totaling 1.33 million barrels per day in 2023, were directed towards West Africa, with Nigeria receiving the majority of these shipments.
The report highlights that the Dangote refinery, which has a capacity of 650,000 barrels, has the potential to eliminate a long-standing petrol trade from Europe to Africa, valued at $17 billion annually.
Analysts and traders cited by Reuters indicate that the Dangote refinery is intensifying competition for European refineries, many of which are already facing the threat of closure. Once fully operational, the Dangote refinery will be the largest in both Africa and Europe.
It is noted that the Dangote refinery is making significant progress towards its goal of reducing Nigeria's reliance on oil imports.
In related news, OPEC has mentioned that maintenance activities at refineries in India, a key supplier of petrol to the Middle East, have further bolstered petrol exports from Europe, enhancing the overall strength of the petrol market.
The gasoline crack spread against Brent averaged $17.34 per barrel, reflecting a month-on-month increase of $2.13, although it remains $14.55 lower compared to the previous year.
In October, the jet/kerosene crack spread in Rotterdam against Brent rebounded from previous losses, supported by favorable supply conditions. According to Platts, jet fuel inventories as of October 31 experienced a monthly decline, likely due to reduced refinery operations and lower output of jet/kerosene.
Looking ahead to December, the jet/kerosene markets are expected to see a temporary boost from increased travel activity during the holiday season. The Rotterdam jet/kerosene crack spread against Brent averaged $15.82 per barrel, up by $1.65 month-on-month, but down from $16.40 year-on-year, as reported by OPEC.