Nigeria’s Dangote refinery has reduced exports of fuel oil used by ships and power plants as a worldwide shortage pushes the price of the product sharply higher.
Reuters reported on Monday that the $20 billion refinery has been exporting more petrol, diesel and jet fuel while its shipments of fuel oil have declined.
The changing product mix comes as conflicts involving Iran and Russia disrupt crude processing and tanker movements, forcing refiners to concentrate on fuels that currently offer stronger returns.
Very-low-sulphur fuel oil, the main marine fuel used to comply with international emissions rules, reached almost $825 per tonne in Singapore on 1 September. That represents a 76% increase since the Iran conflict began, compared with an approximately 40% rise in Brent crude over the same period.
The movement is significant because fuel is one of the largest expenses faced by shipping companies. More expensive marine fuel can eventually feed into the cost of transporting containers, food, vehicles and machinery to African ports.
