Dangote Refinery Imported $4.48 Billion of Crude, Explaining Fuel Price Lag
Updated
Updated · Business Insider Africa · Jul 5
Dangote Refinery Imported $4.48 Billion of Crude, Explaining Fuel Price Lag
3 articles · Updated · Business Insider Africa · Jul 5
Summary
$4.48 billion bought 40.4 million barrels of crude for Dangote Refinery in May and June, which it said explains why Nigerian fuel prices have not fallen in step with recent global oil declines.
Crude for current fuel sales was purchased weeks or months earlier under contracts tied to monthly averages, leaving the refinery processing inventories priced well above the current international benchmark of about $71 a barrel.
Average landed crude costs dropped nearly 24% to $95.25 a barrel in June from $124.80 in May, indicating cheaper feedstock is starting to move through operations.
The 650,000-barrel-per-day refinery said it absorbed part of earlier higher input costs instead of fully passing them to consumers and expects further pump-price moderation if favorable crude prices persist.