By this year’s second quarter, Dangote Refinery might be producing at full capacity, which is 650,000 barrels per day.
This is happening at a time when China is driving the world’s oil consumption to two million barrels per day (bpd), bringing the overall demand to roughly 103 million bpd.
Wood Makenzie projection that The Guardian was able to access yesterday, refining capacity would rise by a very small 600,000 bpd this year.
The successful ramp-up of Middle East capacity and high utilisation rates would accompany the growth.
The study focused on the Dangote Refinery as a major game-changer and emphasized that the plant will successfully ramp up to full capacity of 650,000 bpd by the end of the second quarter of the year.
“The refinery yield of middle distillates, like jet and diesel/gasoil, will rise from a heavier global crude slate as OPEC+ production returns,” said Alan Gelder, senior vice president of research at Wood Mackenzie.
However, according to Gelder, reducing interest rates and rebalancing the GDP are essential to capturing demand growth.
According to the research agency, China will account for more than 25% of the projected two million barrels per day growth in crude oil demand in 2024.
The study,
“Oil and Chemicals: Five Things to Watch in 2024,” in addition to China, three growing Asian markets—Indonesia, Vietnam, and Thailand—as well as the US.
Gelder said, “the second half of the year will see a lot of growth (in oil demand),” which will be “fueled by lower interest rates and improved economic growth.”
As OPEC+ supply restrictions impede growth through 2024, oil supply would expand more slowly than demand.
It further stated that in the absence of this output limitation, the market may become oversupplied, particularly if demand growth is less than anticipated.