Nigeria is one of the world's largest crude oil producers, but limited refining capacity has forced it to rely on fuel imports. Now there's hope that the new Dangote Refinery can help the country reduce imports, stabilize prices and lower fuel costs.
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00:00Rashid Sule's small business keeps Lagos rolling.
00:05He's a roadside vulcanizer, and without people like him, the city would soon grind to a halt.
00:11But without petrol to run his air pump, he can do nothing, and the tyres stay flat.
00:17Fuel shortages have hit him hard.
00:30If you want to buy, you have to pay 1,500 or 1,000 Naira for a litre for the black market.
00:37Rashid, like all Nigerians, had been hoping that the Dangote refinery could bring some relief.
00:43But will its capacity of 650,000 barrels per day be enough to ease the crisis and reduce prices?
00:50Nigeria is Africa's biggest oil producer, but it has long struggled with fuel shortages,
00:56and more recently, rising costs since the removal of fuel subsidies in May 2023.
01:02For Nigerians, that all means long waits at fueling stations and the daily frustration of navigating the fuel crisis.
01:10I'm supposed to be in the office now. I'm not in the office.
01:13So I'll spend hours queuing for fuel.
01:17I just left a fueling station now.
01:19We're just two vehicles to buy fuel, and it finished.
01:23So I have to come and start another queue again.
01:26Until recently, the fuel flowing through this nozzle was exclusively imported from abroad
01:32because Nigeria lacked the capacity to refine its own crude oil.
01:37With the new Dangote refinery in operation, it is hopeful that the country will rely less on expensive imports,
01:44and the price of fuel would reduce.
01:47Energy analysts say there are multiple aspects to the problem,
01:50but at its heart, it comes down to the fact that Nigeria is not pumping enough crude.
01:55It's not enough to feed our local refineries. It's not enough to feed Dangote refinery, for instance,
02:01which is what we are talking about, right?
02:03They still have to import crude, and that is priced in dollars.
02:07So at the end of the day, they need to make, they need to turn out a profit in their business.
02:12The scarcity of crude is just one factor that could throttle the Dangote refinery's market impact,
02:18especially as existing refineries are running at low or no capacity.
02:24Dangote refinery is a good initiative, but other layers, I mean, other refineries,
02:34the Port Harcourt refinery, Gibore refinery, and other modular refineries must work for price to be stabilized.
02:42Licensed importers must be allowed to thrive.
02:46There will be healthy competition and price will fall.
02:49For today, Rashid has found enough fuel to keep his air pump running and the wheels of Lagos rolling.
02:55But the Dangote refinery is just one piece in the puzzle of distribution challenges,
03:00government policy, and market conditions.
03:03It is not yet clear whether it can help solve the fuel crisis
03:07and finally stabilize prices for Nigeria's consumers.