Establishing a West Africa reference fuels market

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Platts collects information from the market on a daily basis to inform its benchmark price assessments. Platts receives information from a variety of market sources whose input is analysed and evaluated to inform the price assessment.

Transparency underpins Platts assessment processes, just as it does Platts data publishing processes. When determining a final market assessment, Platts gives the greatest priority to fully verifiable and transparent market information.

The granularity of information collected varies, and with any new assessment typically evolves and matures to more transparency over time. Platts has a robust methodology which allows to arrive at the most informed assessments in periods of low and high liquidity, in emerging and in mature markets. Information can range from indicative prices from individual sources, to firm, detailed and fully transparent bids and offers which demonstrate value in the Platts reviewed Market on Close (MOC) assessment process. The reviewed MOC is the highest tier of information quality considered by Platts for its assessments and it underpins all of the established Platts refined product benchmarks in Europe and globally. Further details concerning Platts MOC Participation Guidelines can be found online.

As part of the development of Platts West Africa price assessments, the movement toward increased transparency is critical. One of the methods which improves data quality input is called Direct, Confirmed Data.

Direct, Confirmed Data is a methodology that allows participants to submit to Platts fully confirmed and transactable bids and offers open to the marketplace as a whole. Direct, Confirmed Data should include full details around the specified bid and offer, such as loading terminal/s, loading dates, volume and specifications. These are then published to the wider market, where participants can express interest to trade the published bid or offer. The bid, offer or trade is then used to inform and evaluate the day’s price assessment, and they are prioritised over indicative values or other reported transactional activity heard across the market on the day.

Before the launch of the Dangote refinery, the refined product landscape in West Africa was marked by low refinery production and a significant dependence on imports. Among the 16 countries in the region, only five had refining capacity: Côte d’Ivoire, Ghana, Niger, Nigeria, and Senegal.

Although the nameplate capacity of the region’s refineries was approximately 620,000 barrels per day (b/d), actual refined product output sat well below those volumes due to inefficiencies and low utilization rates. In 2020, all four state owned refineries in Nigeria, along with Ghana’s Tema oil refinery, were shut down for rehabilitation, leaving just three West African markets with operational refinery facilities.

West Africa’s demand for refined products, on the other hand, has been on a near-vertiginous ascent since the turn of the century, driven by strong demographic and economic tailwinds. Demand for refined products—namely LPG, gasoil, gasoline, jet fuel, kerosene, and RFO—rose from 370,000 b/d in 2000 to just under 1,000,000 b/d in 2023. While demand grew steadily, regional supply moved in the opposite direction. From a high of just under 380,000 b/d in 2005, refinery output fell to approximately 200,000 b/d by 2023.
 

Insufficient production, coupled with ever-growing demand, resulted in a situation where, in 2023—the year before the launch of the Dangote refinery—West Africa’s demand for refined products exceeded regional supply by nearly 800,000 b/d. Most of the shortfall was filled through imports, predominantly sourced from Northwest Europe, particularly from the Amsterdam-Rotterdam-Antwerp (ARA) refining and storage hub, as well as from markets such as Russia, India, and Spain.

The 2024 launch of the Dangote refinery led to a significant reconfiguration of regional refined product dynamics. West Africa now produces more LPG, jet fuel, kerosene, and residual fuel oil than it consumes. Additionally, while the region as a whole remains a net importer of gasoline and diesel—its two most consumed refined products—the supply shortfall for both has seen a sharp reduction over the past year and a half. For context, the supply deficits for gasoline and gasoil were 475,000 b/d and 240,000 b/d, respectively, in 2023. In 2025, these deficits are projected to fall to 365,000 b/d and 112,000 b/d.

The Dangote refinery is already supplying products to West African markets such as Togo, Côte d’Ivoire, and Ghana, in addition to exports to Asia, Europe, and the Americas. Its role in supplying the region is expected to expand further as it continues ramping up towards full capacity. As of July 2025, the refinery was operating at nearly 65% of its capacity and is projected to reach full capacity by the second half of 2026. However, scheduled and unscheduled maintenance, which are normal for a refinery of Dangote’s size and complexity, could slow down the ramp-up timeline.

Despite the substantial and long-awaited capacity that the Dangote refinery brings, long-term demand is expected to far outstrip supply, as West Africa is not expected to add significant additional refining capacity at this stage. While a handful of greenfield refinery projects have been announced over the years, their realization continue to face significant financial hurdles. Meanwhile, rehabilitation efforts at Nigeria’s four state-owned refineries have proven more challenging than anticipated, casting a shadow over their long-term prospects.

Against this backdrop, imports into the region are expected to reach a low point in 2027, coinciding with maximal output from Dangote, before progressively increasing over the long term due to rising demand and limited new refining capacity additions. By 2050, S&P Global Energy project that, in the absence of significant refinery additions, refined product import requirements will exceed 1,000,000 b/d, more than 200,000 b/d above pre-Dangote refinery levels.

Unless regional refineries are rehabilitated and new refineries built given the trends in demand for gasoline and diesel/gasoil West Africa will still depend on imports of these fuels in addition to local refinery production in the medium-to-long term.

It will be critical for regional West African and global refined product benchmarks to evolve and complement each other effectively in order to provide the fast-growing West African market with the most relevant reference prices and hedging tools that allow for effective trading and financing.