The African Export–Import Bank (Afreximbank) has pledged a significant $3 billion investment aimed at stimulating intra-Africa trade in refined oil products, thereby reducing the continent’s reliance on imported fuel. The announcement was made by Kanayo Awani, Afreximbank’s Executive Vice-President, during an energy conference held on Monday in Cape Town, South Africa.
Awani explained that the initiative will focus on financing the trade of vital refined products, such as premium motor spirit, automotive gas oil, heavy fuel oil, jet fuel, and kerosene. These transactions will be facilitated under a revolving intra-African oil importing financing scheme, aimed at boosting self-sufficiency in energy resources.
“The time has come for Africa to take control of its energy destiny,” Awani stated, drawing attention to the continent’s current energy challenges. Despite being abundant in crude oil and natural gas, Africa still imports a large portion of its refined oil products due to insufficient refining infrastructure and capacity. He further noted that Africa exports approximately 80% of its crude oil and 45% of its natural gas, leaving the continent vulnerable to external market fluctuations.
Awani highlighted the inadequate and outdated refining infrastructure in sub-Saharan Africa, which is operating well below its potential. As a result, African nations collectively spend around $30 billion annually on importing refined petroleum products. This new funding is expected to address these shortcomings and enhance Africa’s ability to process and distribute its own refined oil products.
Afreximbank has previously been a major player in the development of the continent’s oil and gas sector, supporting high-profile projects like the Dangote refinery, which has a capacity of 650,000 barrels per day, as well as refineries in Angola’s Lobito and Cabinda regions. According to Reuters, these investments have significantly helped Nigeria increase its refining capacity to 1.3 million barrels per day, with the Gulf of Guinea emerging as a key refining hub for Africa.
“Our goal is to support 3 million barrels per day of refining capacity in the near to medium term — that is our ambition,” Awani remarked, underlining the bank’s commitment to transforming Africa’s energy landscape.
The growing demand for cleaner fuels, driven by Africa’s expanding population and economies, further underscores the importance of this investment. A joint report by CITAC and Puma Energy forecasts a 56% increase in demand for cleaner fuels by 2040, which is expected to reach 142 million metric tons, up from current levels.
Afreximbank’s $3 billion investment could have far-reaching implications for Africa’s energy future, reducing the continent’s exposure to global supply chain disruptions and volatile fuel prices. According to Nairametrics, Nigeria is becoming an emerging refining hub in West Africa, with projects like the Dangote Petroleum Refinery FTZ and other new refineries underway. However, analysts suggest that Nigeria’s refining ambitions will only be realised if the country can increase its crude oil production. Currently, Nigeria struggles to meet its target of 2.06 million barrels per day, with its current output hovering around 1.5 million barrels daily.
Awani reiterated Afreximbank’s commitment to advancing Africa’s refining capacity and promoting intra-Africa trade in refined oil products, signalling a transformative shift for the continent’s energy sector.