A research analyst at Coronation Research, Gbemi Adelokiki, has emphasized that Nigeria’s growing local refining capacity particularly through the Dangote Refinery is critical to stabilizing fuel supply and reducing the economic disruptions historically caused by shortages.
Speaking during an interview on ARISE News on Tuesday, Adelokiki noted that fuel supply stability plays a central role in economic productivity, stressing that past disruptions often led to long queues, black market activity, and slowed business operations.
“Each time there is a disruption… we’ll have queues at filling stations… it basically slows down economic growth,” she said.
She explained that the emergence of large-scale domestic refining capacity marks a significant shift from Nigeria’s previous dependence on imported petroleum products, which made the country vulnerable to global supply shocks.
“We are gradually shifting from that dependency… to a position where we can now even influence other African countries,” she stated.
According to Adelokiki, the ability of the Dangote Refinery to produce up to 650,000 barrels per day signals a transition toward greater energy security, with the potential to not only meet local demand but also support exports across the continent.
“It implies that we are gradually moving away from that previous status where we depended on how things moved globally,” she added.
Addressing the ongoing “crude-for-naira” policy debate, Adelokiki clarified that while the initiative may appear refinery-focused, its broader impact lies in easing pressure on Nigeria’s foreign exchange market.
“If more crude is sold in naira… it removes the burden of having to get foreign exchange… and reduces pressure on our naira,” she explained.
She highlighted that a significant constraint to expanding local refining operations is the limited availability of crude oil, much of which is already tied up in pre-existing contracts and joint venture agreements.
“Most of it has been pre-committed… what is available is far less than we may understand,” she noted.
This supply limitation, she said, directly affects the refinery’s ability to operate at optimal capacity, pointing out that current allocations fall short of operational needs.
“Dangote needs about 13 to 17 cargoes… what is being allocated is still not sufficient,” she said.
Adelokiki also weighed in on concerns about fuel pricing transparency, supporting the view that refining is inherently a volatile and margin-driven business influenced by global crude price fluctuations.
“What should be important now should be the margins… that’s how we can measure their efficiency,” she stated.
Looking ahead, she described the anticipated public listing of the Dangote Refinery as a major opportunity for investors, given its scale and strategic importance in Nigeria’s energy sector.
“It’s a very much anticipated investment… investors will be very much excited to be part of such an option,” she said.
Beyond refining, Adelokiki pointed to renewed interest in Nigeria’s oil sector, including potential deepwater investments by international oil companies, as a sign of shifting industry dynamics.
“Offshore implies more capital commitment… but you’re able to avoid issues like vandalism,” she explained.
Adelokiki concluded that while challenges remain particularly around crude supply Nigeria’s move toward domestic refining represents a critical step toward long-term fuel supply stability and reduced vulnerability to global market disruptions.
Triumph Ojo
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