Crude oil exports from Nigeria to Europe have surged to 730,000 barrels per day, marking an increase despite a shortage of supply to local refineries. The Nigerian National Petroleum Company Limited disclosed that this rise in crude oil flow to Europe aims to fill the supply gaps left by the ban on Russian crude. Simultaneously, the Crude Oil Refinery Owners Association of Nigeria stated that the Federal Government is taking steps to enhance the supply to local refineries.
Maryamu Idris, the Executive Director of Crude and Condensate at NNPC Trading Limited, revealed this information during a presentation at the Argus European Crude Conference in London. She emphasized the growing significance of Nigerian crude grades in the post-Russia-Ukraine war landscape for European refiners. Nigerian grades such as Forcados Blend, Escravos Light, Bonga, Egina, and Nembe Crude are gaining preference, filling the void left by the absence of Russian Urals and diesel.
This development comes amid reports that local refineries in Nigeria, including the Dangote Refinery, have faced a shortage of crude oil supply, leading to production delays. The Nigerian government, acknowledging the importance of meeting domestic crude obligations, has expressed concern about the potential national embarrassment if local refining capacity is not enhanced.
Responding to the increase in crude oil exports to Europe, the Crude Oil Refinery Owners Association of Nigeria expressed optimism that the government would provide the necessary crude for modular refineries. However, concerns persist about the impact on domestic refineries, such as Dangote Refinery, which missed its October production target.
Additionally, crude oil exports from Nigeria to India have reportedly dropped by 52%, attributed to the conflict between Russia and Ukraine, which affected Nigerian crude inflows in the international market. The Nigerian government is now working on strategies to address production challenges and boost the country’s refining capacity. The implementation of the Petroleum Industry Act 2021 and partnerships with financial institutions are seen as steps toward revitalizing the oil industry.
Oil marketers have reiterated their call for increased crude oil supply to local refineries, emphasizing the importance of supporting modular refineries to reduce the country’s dependence on imported petroleum products. The reduction in subsidies on petrol is expected to facilitate the operation of modular refineries, provided they receive the necessary support, including the supply of crude oil.