Oil Irony: Africa’s Biggest Refinery Prefers U.S. Barrels Over Nigerian Grades
In a twist that highlights the strange realities of global oil trade, Indian refiners are ramping up purchases of Nigerian crude — while Nigeria’s own $20 billion Dangote Petroleum Refinery leans heavily on U.S. oil to keep its operations running.
Industry sources revealed that Indian Oil Corporation recently secured one million barrels of Nigeria’s Agbami crude for September delivery, part of a wider buying spree that has seen Indian refiners acquire millions of barrels from non-Russian suppliers. Bharat Petroleum has also bought Nigerian grades for upcoming deliveries.
The shift comes after U.S. pressure on India to reduce Russian imports, prompting New Delhi’s state refiners to look to Africa and the Middle East. By September and October, India is expected to import over two million barrels of Nigerian oil.
Meanwhile in Lagos, the Dangote Refinery — touted as Africa’s largest — is importing more U.S. West Texas Intermediate (WTI) crude than Nigerian grades. In July, U.S. barrels made up about 60 percent of its record 590,000 barrels per day intake, while Nigerian grades accounted for just 40 percent.
Market analysts say U.S. crude has become more competitively priced than some Nigerian options, partly because American suppliers have struggled to find buyers in Asia. Dangote’s heavy reliance on imports also reflects persistent challenges in securing adequate domestic supply despite Nigeria’s official crude allocation policy.
The refinery, currently running at 85 percent capacity, plans to expand to 700,000 bpd, with most of its output sold as gasoline domestically, while some is exported to West Africa, Europe, and the Middle East. However, analysts caution that mechanical issues and maintenance could keep the plant from operating at full capacity until at least late 2026.
Despite the irony of the situation, Dangote’s strategy underscores a simple truth of global oil markets: for refiners, price and availability often trump national supply pride.
