Hot Source•Facility to supply petrol, diesel to Botswana, Namibia, Zambia, Zimbabwe
•Oil falls as possible OPEC+ hike pause signals waning demand
Emmanuel Addeh in Abuja
Dangote petroleum refinery will construct storage tanks in Namibia to hold at least 1.6 million barrels of petrol and diesel to supply refined fuel to southern Africa, a Reuters report has said.
Quoting two sources, it said that the move underscores the refinery’s ambition to dominate fuel supply in Africa and beyond, potentially reshaping energy trade flows in the region and boosting access to refined products for southern African nations.
The 650,000 barrels per day refinery, built at a cost of $20 billion by Africa’s richest man Aliko Dangote, started operations last year and has been ramping up production and seeking new markets.
The sources, who Reuters said were briefed on the development, said the storage tanks would be used to supply petrol and diesel to Botswana, Namibia, Zambia and Zimbabwe.
Dangote was also considering supplying fuel to southern Democratic Republic of Congo, the sources said. A Dangote spokesperson did not respond to a request for comment. It was not immediately clear how much the project would cost, but the second source said construction of the storage tanks would begin shortly in the port city of Walvis Bay.
A Namibia Ports Authority official confirmed the plans to Reuters and said the storage tanks would be housed within the Walvis Bay harbour.
A source said last month that a Dangote petrol cargo was heading to Asia, the first time the refinery was selling the fuel outside the West Africa region. Dangote refinery says at full capacity, the plant would produce enough to meet demand in Nigeria, which has sharply cut imports of processed fuels, and export the rest.
Meanwhile, oil futures sank yesterday as the escalating global trade war and the possibility that the Organisation of Petroleum Exporting Countries and its allies (OPEC+) may halt output hikes flashed warning signs for energy demand, a Bloomberg report said.
West Texas Intermediate (WTI) futures fell as much as 2.6 per cent to trade below $67 a barrel after Bloomberg reported that the cartel is discussing a pause in further production increases from October. Brent was selling for $68.90 per barrel last night. The early-stage deliberations are taking place as President Donald Trump unveils a new round of tariffs, including a 50 per cent rate on Brazil, which sends some oil to the US.
Traders are probably interpreting the OPEC+ talks as a sign that “the market may not be able to cope with more oil,” said Ole Hansen, head of commodity strategy at Saxo Bank A/S. “We are potentially seeing the risk of an oversupplied market” once the peak demand period ends, he said.
The US-led tariff war has intensified in recent days, and Trump’s latest salvo of demands has overshadowed earlier deals with major trade partners including China and the UK, which had served to mollify investors. Now, the market is facing some of the highest tariff rates in US history, setting the stage for an uncertain period for global growth.
Oil has edged higher this week even after OPEC+ decided over the weekend to raise output by more than expected in August. Energy Aspects said it expects global oil demand to rise by less than 1 million barrels a day in the third and fourth quarters amid pressure from US tariff policies.
Houthi attacks in the Red Sea have sunk two cargo vessels and left multiple crew members dead. The escalation has notably failed to inject a risk premium into oil prices, with investors reluctant to buy on geopolitical developments after a standoff between the US and Iran spared energy infrastructure.
