As wars in the Middle East and Eastern Europe continue to reshape global energy trade, African countries are increasingly turning to the United States for fuel supplies, despite the rise of Nigeria’s Dangote Refinery as the continent’s largest refining hub.
According to data from energy intelligence firms Vortexa and Kpler cited by Bloomberg, U.S. refiners have significantly increased diesel and gasoline shipments to Africa in recent months, making the United States one of South Africa’s leading sources of refined fuel products.
The shift highlights the vulnerability of Africa’s fuel supply chain.
The conflict involving Iran has raised concerns about disruptions to shipping routes through the Strait of Hormuz, one of the world’s most important energy chokepoints.
Kpler estimates that about 42% of gasoline, diesel and jet fuel imports into East and Southern Africa are linked to trade routes passing through the strait, exposing the region to geopolitical risks.
South Africa has been particularly affected. Following the closure and conversion of several domestic refineries over the past decade, Africa’s most industrialized economy has become heavily dependent on imported fuel.
Despite Dangote Refinery increasing output to 700,000 barrels per day, Africa’s overall fuel deficit is too large to be covered by a single facility.
While the country traditionally sourced much of its diesel and gasoline from the Middle East and India, traders are increasingly turning to refineries in Texas and Louisiana to secure replacement cargoes.
Why Dangote cannot fill the gap alone
The growing reliance on U.S. fuel imports does not reflect a failure of the Dangote Refinery. In fact, the refinery recently increased crude processing to 700,000 barrels per day, surpassing its original nameplate capacity of 650,000 bpd.
However, Africa’s fuel deficit remains enormous. Countries including South Africa, Kenya, Ghana, Tanzania, Namibia and Senegal collectively import millions of tonnes of refined petroleum products annually.
Even at 700,000 bpd, a single refinery cannot immediately replace the vast network of suppliers spanning the Middle East, India, Europe and the United States.
Moreover, much of Dangote’s output is absorbed by Nigeria’s vast domestic market.
The country consumes about 63.7 million litres of petrol daily, equivalent to roughly 400,000 barrels per day alongside significant volumes of diesel and aviation fuel, limiting the amount available for export even as the refinery ramps up production and expands its footprint across Africa.
A tanker discharges crude oil via single-point mooring (SPM) during a ceremony to mark the first delivery of crude oil to the Dangote Industries Ltd. refinery in the Ibeju Lekki district of Lagos, Nigeria, on Saturday, Dec. 9, 2023. [Photo: Benson Ibeabuchi/Bloomberg via Getty Images]
The result is a transition period in which Africa is benefiting from Dangote’s growing output while still relying on global suppliers during times of market stress.
A future where Africa imports less fuel
That dependence could diminish significantly over the coming years.
Dangote has announced plans to double refining capacity to 1.4 million barrels per day within the next 30 months, a move that could transform the facility into one of the largest refining complexes in the world.
Company executives have also indicated interest in expanding refining capacity beyond Nigeria, including potential projects elsewhere on the continent.
If achieved, the expansion would mark a major shift in Africa’s energy landscape. Greater regional refining capacity could reduce the continent’s dependence on imported fuels, lower shipping costs, improve fuel security and shield African economies from disruptions caused by conflicts in distant regions.
For now, however, the surge in U.S. fuel exports underscores a reality that Africa’s energy transition remains unfinished.
While Dangote is rapidly emerging as a strategic supplier for the continent, global refiners still play a crucial role in keeping African economies fueled when supply shocks hit.