Nigeria's Dangote refinery, situated near Lagos, has exported its first jet fuel cargo to Europe, according to an S&P Global Insights report. BP is transporting the jet fuel to Rotterdam, following a tender of 120,000 metric tonnes offered at the end of May. Four market sources confirmed the shipment, S&P Global Insights reported.

The Doric Breeze vessel loaded 45,000 metric tonnes of jet fuel from Lekki on May 27, marking BP's inaugural cargo from Dangote, as per S&P Global Commodities at Sea data. Additionally, Cepsa, a Spanish refiner, secured part of the tender and is expected to deliver supplies to Europe soon, traders noted.

Representatives from BP and Cepsa were unavailable for comment, but a Dangote spokesperson confirmed the refinery's compliance with European jet A1 standards since April. This inaugural European shipment underscores the expanding reach of the 650,000 barrels per day Dangote refinery, which is quickly ramping up operations and altering West African trade dynamics.

Since April 8, Dangote has exported six jet fuel and kerosene cargoes to Senegal, Togo, and Ghana, according to CAS data. BP is expected to continue supplying jet fuel to West Africa from the Dangote refinery, sources indicated.

European traders have expressed concerns that the new jet fuel supply from Nigeria could exacerbate the existing oversupply in the market. As of May 29, CIF Northwest European jet fuel cargoes were trading at a premium of $52 per metric tonne to the front-month ICE LSGO contract, down $3.25 on the day and $11.25 on the week, according to Platts assessments.

The increased supply has closed the arbitrage window from the Persian Gulf, with the CIF NWE June and July contracts entering a contango of minus $1.50 per metric tonne on May 29. This contango, indicating market weakness, was last seen lower on April 25, when the second-month contract was at a $1.75 premium to the front-month, Platts data showed.

Dangote's export portfolio is poised for changes as the refinery continues to ramp up operations. To date, it has exported naphtha, fuel oil, and gasoil to markets in Europe, Africa, and Asia. However, naphtha exports may soon be reduced to prepare for gasoline production, a Dangote representative told Commodity Insights on May 20.

Dangote has been exporting about four naphtha cargoes per month to Europe since April. These volumes are expected to decrease as domestic supplies are redirected for gasoline blending, once the refinery's fluid catalytic cracker is operational. Dangote now projects its first gasoline supplies to begin in June, revised from an earlier May deadline. The refinery also aims to produce ultra-low sulphur diesel for export to Europe by the third quarter, as stated in April.

Commodity Insights analysts predict that gasoline supplies from the refinery will commence no earlier than the third quarter, with steady-state utilisation expected around 2027. At steady-state, Dangote is anticipated to produce 9% jet fuel, or about 45,000 barrels per day at 80% utilisation. Early supplies could make Nigeria a net exporter of jet fuel by the fourth quarter of 2024.

The Dangote refinery and petrochemical complex in the Lekki Free Zone near Lagos is the world's largest single-train facility, producing Euro-V quality petrol, diesel, jet fuel, and polypropylene. At full capacity, the refinery will double Nigeria's refining capacity and help meet the growing demand for fuels, providing significant cost and dollar savings.