Shortage of aviation fuel could lead to increased shipments from Dangote to European markets

As the Middle East faces disruptions, Europe may increasingly rely on Nigeria's Dangote refinery to meet its jet fuel needs, according to a report by Kpler. The effective closure of the Strait of Hormuz has resulted in a significant reduction in global seaborne jet fuel supply, with nearly 21 per cent being cut off.

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The report notes that European imports are expected to drop by almost 300,000 barrels per day, with approximately 247,000 bpd typically destined for North West Europe, leading to a tightening of availability in the region.

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Kpler states that the loss of Middle Eastern cargoes has left Europe with limited replacement options, as traditional backup suppliers in Asia are redirecting shipments to meet stronger regional demand, with Eastern barrels becoming increasingly unavailable.

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Strong Asian pricing and export restrictions in China, and potentially South Korea, are diverting cargoes away from Europe, according to the report, which also mentions that cargoes from India, particularly from the Jamnagar refinery, would normally provide relief in such situations.

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However, concerns over European Union sanctions linked to Russian crude have discouraged buyers from purchasing from India, leading to a shift in attention to the Atlantic Basin, especially the United States Gulf Coast and West Africa, including the Dangote refinery.

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Kpler notes that Dangote exported about 89,000 barrels per day of jet fuel in 2025, positioning it as a potential alternative supply source for Europe, and that West Africa has become structurally long on refined products, largely due to output from the Dangote refinery.

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The report states that this means export volumes could still be available even if domestic supply priorities are maintained, and that the US Atlantic Coast is largely supplied from within the US, with some flow from Canada, resulting in a significantly weaker reaction in the US.

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Kpler anticipates more exports to come in March from the USGC, helping to offset the lost cargoes from the AG, but notes that the USGC will not fully offset the missing volume, despite West Africa being a net long region in 2024, thanks to the Dangote refinery.

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The structural length in West Africa means that even if a policy of first supplying the domestic Nigerian market were enacted, exports would still materialise, especially as the refinery returns from maintenance, with Dangote having exported around 89kbd of jet fuel in 2025.

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Analysts caution that supplies from other sources would not be sufficient to fully offset the shortfall created by the loss of Middle Eastern flows, with Kpler stating that exports from the US Gulf Coast remain constrained by existing demand from Latin America, specification differences, and infrastructure limitations.

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Despite arbitrage opportunities to Europe, exports from the US Gulf Coast rarely exceed one million tonnes in a month, although in January exports hit an all-time high of 307,000 barrels per day, according to the report.

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The report also highlights logistical challenges in redistributing supplies within Europe, noting that refinery configurations, existing diesel commitments, and infrastructure limitations could hinder efforts to boost jet fuel output locally.

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Sustainable aviation fuel is gradually gaining traction in Europe due to regulatory mandates, but Kpler notes that it still accounts for only a small share of total supply and would have minimal impact on the current supply gap.

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As a result, the report concludes that even with increased flows from the US and West Africa, including the Dangote refinery, Europe is unlikely to fully replace lost Middle Eastern jet fuel supplies in the near term.

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The market would instead have to adjust through higher prices and longer trade routes to rebalance supply, according to Kpler.