Dangote Refinery carves out spot in US jet fuel market, thanks to maintenance-related disruptions
By Jeph Ajobaju, Chief Copy Editor
Dangote Refinery, that is being filibustered at home by the vested industrial-scale corruption in the Nigerian government, is calling some shots in the global market with its jet fuel exports to the United States on a two-year high in March, encouraging it to pivot to Europe.
Despite the Donald Trump global trade war, America remains a key destination for the refinery and is also turning its sights on bigger European consumers to compete in the supply chains.
Reuters reports that Dangote, a 650,000-barrel-per-day (bpd) refinery, has already shipped six vessels carrying 1.7 million barrels of jet fuel to the US this month, quoting ship-tracking service Kpler.
Another vessel, Hafnia Andromeda, is expected to arrive at the Everglades terminal in the US by March 29 with an additional 348,000 barrels.
Despite facing challenges in Nigeria and uncertainties amid the sale of crude in foreign currencies rather than the initial agreement of naira, the refinery is likely to become a regular jet fuel supplier to the US, pending a maintenance-related shutdown of the Phillips 66 (PSX.N) refinery in New Jersey, Sparta Commodities analyst James Noel-Beswick said, per Reuters.
Dangote Refinery started production last January after years of construction delays and ramped up to about 85 per cent of capacity in early February, allowing it to sell more fuel to international markets.
Although the surge in US imports was triggered by a maintenance-related shutdown of the Phillips 66 Bayway refinery in New Jersey, analysts believe Dangote’s presence in the international market is just beginning.
Having successfully challenged European refiners in gasoline exports, the Nigerian refinery is poised to expand further into Europe’s jet fuel market.
With European refiners facing higher production costs and increasing competition, Dangote’s entry could drive down prices and disrupt traditional supply chains.
America will benefit from Dangote’s influx ahead of the peak summer travel season if imports go smoothly between Dangote and the North American country, Barsamian told Reuters.
Meanwhile, U.S. demand for jet fuel storage has surged, with storage requests in Houston and New York Harbor for April reaching five to six times the usual monthly average, according to storage broker TankTiger.
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