Nigeria and South Africa: The Energy Landscape Shift

Recent developments in Africa’s energy scene are hard to ignore, particularly when we consider Nigeria’s evolution from being the continent’s most significant petrol importer to approaching self-sufficiency in fuel production. For years, Nigeria, despite its status as one of Africa’s largest crude oil producers, has struggled with heavy reliance on imported refined petroleum. What does this transformation mean for the national psyche? Could this be the moment Nigeria begins to reclaim its energy narrative?

The turning point can largely be attributed to significant reforms in Nigeria’s petroleum sector, chief among them being the operational launch of the Dangote Refinery—acclaimed as Africa’s largest. Additionally, the establishment of several modular refineries scattered across the nation has played a crucial role in this turnaround. They have contributed immensely to the country’s domestic refining capacity, effectively diminishing the need for imported fuel.

It’s important to contextualize this achievement. Historically, Nigeria’s oil wealth did not translate into efficient fuel distribution systems. Poorly performing refineries and a cumbersome fuel subsidy system plagued the market, often causing disruptions in supply chains. Consequently, the country found itself in the perplexing position of importing a lion’s share of its refined petroleum products. Yet, amid these challenges, the recent reforms signal a commitment to enhancing local refining output and improving energy independence.

Meanwhile, we observe contrasting fortunes in South Africa, where rising import levels are driven by persistent fuel demand coupled with significant constraints in its domestic refining sector. Key facilities have shut down or suffered delays in upgrades, limiting local production capacity and forcing the country down a path of increased reliance on imports. As a nation, how does one reconcile being an oil-rich continent with the challenges of local production capabilities?

The juxtaposition of these two nations illustrates broader shifts within Africa’s energy narrative. Investment in refining infrastructure and proactive policy reforms are beginning to redefine traditional trade patterns, urging us to reconsider what we thought we knew about energy economics on the continent.

The Report

A recent report by the energy consultancy CITAC underscores the seismic impact of the Dangote Refinery on Nigeria’s fuel import volumes, which plummeted significantly in the first quarter of 2025. According to the study, Nigeria imported 3.1 million tonnes of refined petroleum products during this period—a remarkable decline from previous years.

In stark contrast, South Africa imported around 4.2 million tonnes of refined petroleum products during the same time frame, officially claiming the title of sub-Saharan Africa’s largest fuel importer. The numbers tell a compelling story, do they not? With such striking changes, we may ponder: what’s the next chapter in these evolving energy narratives?

The operational gains of the Dangote Refinery can be directly linked to these changes. Since its inception in September 2024, Nigeria’s dependence on imported petrol has shrunk tremendously, with the refinery currently supplying about 60% of the country’s petrol demand. Elitsa Georgieva, the Executive Director at CITAC, encapsulates this shift when she noted: “Nigerian imports are dropping as a result of the continued operation of Dangote.”

Additionally, 2024 witnessed a remarkable surge in crude throughput across sub-Saharan African refineries, with a 77.8% year-on-year increase. Daily output rose from 382,500 barrels per day in 2023 to a striking 680,100 barrels in 2024—this expansion is primarily driven by the Dangote Refinery.

With a nameplate capacity of 650,000 barrels per day, the Dangote Refinery ramped up operations to 550,000 barrels daily by January 2025, a feat worth celebrating. CITAC projects that Nigeria’s total refined fuel imports for 2025 will plummet to 6.4 million tonnes—less than half of South Africa’s expected 15.5 million tonnes. This pivotal shift not only positions Nigeria as a competitor in energy independence but also sets a precedent for other African nations grappling with similar issues.

The Nigerian Economic Summit Group anticipates that the Dangote Refinery could save Nigeria as much as $10 billion in foreign exchange this year, largely by reducing the burden of costly petrol imports. Meanwhile, South Africa’s energy sector paints a different picture, grappling with persistent struggles. Almost 49% of its refining capacity remains idle, with total capacity having been slashed in half over the past five years due to a mix of industrial accidents and chronic underinvestment.

Consequently, South Africa now finds itself relying on imports for over 60% of its fuel needs, as highlighted by reports from Transnet SOC Ltd., the state-owned logistics company. Key facilities remain offline, including Sapref, the country’s largest refinery, which has removed 180,000 barrels a day from production. The Engen plant is similarly affected, now under Vitol’s ownership and also out of commission.

This unfolding narrative of energy self-sufficiency and dependency reveals more than just statistics; it resonates with national pride, economic ambition, and regional collaboration. As both nations navigate these challenges, one can’t help but wonder—what will the future hold for Africa’s energy landscape? Can we hope for more innovative solutions and sustainable practices?