Recent figures provided by the UK's Department for Business and Trade factsheets reveal that as of Q3, 2023, the total trade in goods and services between the UK and Nigeria reached £6.7 billion. This indicates a rise of £136 million compared to Q3 2022. One of the most sold Nigerian goods to the UK is its refined oil, second only in value to its staple product; crude oil.
The report indicates a significant decrease of 21.2% in UK exports of goods to Nigeria, amounting to £357 million in current prices for the four quarters leading up to the end of Q3 2023.
However, while Nigeria saw a decline in imports from the UK, its exports experienced a modest increase of 1.2%, amounting to £32 million compared to the corresponding period in 2022.
The report also listed the top 5 goods sold by the UK to Nigeria and the top 5 goods sold to the UK by Nigeria.
The top 5 products Nigeria sold to the UK include crude oil gas, aircraft, metal ores & scrap, and refined oil. Aside from crude oil, which has become Nigeria's staple export accounting for 62.6% of all the goods it exports to the UK, refined oil came in second, making up 17.8% or £334.5 million of all the products it exported to the UK.
According to the Annual Statistical Bulletin 2023, issued by the Organisation of the Petroleum Exporting Countries (OPEC), as seen in the Nigerian newspaper, the PUNCH, Nigeria has the lowest oil production capacity of all OPEC nations, at 6,000 barrels per day.
The country's capacity to produce oil has been on a downward spiral since 2018, going down from a production capacity of 33,000 to now 6,000. This has raised concerns about the country's continuous importation of petroleum products, despite the fact that the government owns the refineries.
However, the newly inaugurated Dangote refinery, owned by Africa's richest man, Aliko Dangote is set to increase the country's production capacity, albeit an increase which would be channeled through and to the country's private sector.
Nigeria's refinery plans
The $20.5 billion Dangote refinery, Africa's largest, has a processing capacity of 650,000 barrels per day. It aims to produce 250,000 barrels per day of gasoline and 100,000 barrels per day of gasoline and diesel.
The refinery would produce oil for both local consumption and international trade. Already, 150,000 fuel stations run by the Independent Petroleum Marketers Association of Nigeria (IPMAN) have been sanctioned to receive fuel supplies from the newly built private Dangote refinery.
Additionally, Nigeria announced plans to rehabilitate one of its dilapidated refineries, the Kaduna Refinery and Petrochemicals Company (KRPC), located in the Northern region of Nigeria. The Minister of State for Petroleum Resources (Oil) Heineken Lokpobiri, noted that the project will be finished in time for operations to begin in the fourth quarter of 2024.
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