Preliminary data from analytics firm Kpler indicates that West Africa is poised to receive a record 730,000 barrels per day (bpd) of gasoline from Europe this month.
This surge in imports, if realized, would mark a significant increase of over 70% compared to January’s figures and represents the highest volume since Kpler began tracking exports on this route in early 2017.
According to Reuters, the majority of these shipments are destined for Nigeria, the continent’s most populous nation.
Europe, being a net producer of gasoline, serves as a major supplier to West Africa, as well as to the United States, the largest consumer of gasoline globally.
However, with high inventories and reduced demand in the U.S. during January, European fuel prices experienced a decline, making them more attractive to importers.
The relatively low prices of European gasoline, especially compared to counterparts in the U.S. and Asia at the beginning of February, contributed to the surge in imports to West Africa. However, analysts anticipate a slowdown in this flow in March as the European gasoline market strengthens.
“Until the beginning of February, European gasoline was pricing particularly cheaply versus counterparts in the U.S. and Asia,” Sparta Commodities analyst Philip Jones-Lux said.
“But with the European gasoline market picking up strongly so far in February, we’d expect to see this flow slow once again in March.”
Shipping disruptions in the Red Sea led to an abundance of cheap naphtha in Europe, a component used in gasoline production. This surplus naphtha, typically destined for Asia Pacific, remained in Europe, further boosting gasoline availability for export.
Looking ahead, the completion of the Dangote oil refinery in Nigeria, although still in its testing phase, is anticipated to reduce Africa’s reliance on European products. However, for now, Europe remains a significant source of gasoline for West Africa, driven by favorable pricing dynamics and ample supply.
