Dangote refinery has made its first purchase of Algeria’s light sweet Saharan Blend crude, marking a strategic shift in its crude sourcing.
According to Augus Media, Dangote secured a 1 million-barrel cargo from trading firm Glencore this week. The shipment is expected to arrive at the Lekki-based refinery between March 15 and 20.
While neither Dangote nor Glencore has directly confirmed the deal, the pricing details remain undisclosed.
The acquisition signals the refinery’s increasing diversification in crude procurement. So far in 2024, nearly 420,000 b/d of crude has been delivered to the Dangote facility, with 82% consisting of light sweet grades. Nigerian crude has dominated supply, accounting for 87% of total deliveries.
Traders indicate that Saharan Blend’s chemical properties align well with Dangote’s refining requirements, and its pricing remains competitive against Nigerian crude.
The sluggish demand in Europe—driven by seasonal refinery maintenance and an oversupply of light crude—has contributed to a slowdown in March-loading Saharan Blend trade. European buyers, anticipating weaker price differentials, have held back on purchases, creating opportunities for sellers to tap into alternative markets such as Nigeria.
As a result, Saharan Blend’s price has fallen by $1 per barrel in February, now standing at a 20-cent-per-barrel discount to the North Sea Dated benchmark on a free-on-board (FOB) Algeria basis.
With this purchase, Dangote appears to be positioning itself strategically in the crude oil market, leveraging price advantages while optimizing feedstock for its state-of-the-art refinery.