• Says Africa must stop relying on foreign price benchmarks
• Set to host second West Africa refined fuel conference
Emmanuel Addeh in Abuja
The Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) yesterday intensified efforts to establish West Africa as a regional petroleum products pricing and trading hub, arguing that Africa can no longer continue to rely on benchmarks determined outside the continent despite being a major producer of crude oil and natural gas.
The Authority Chief Executive of the NMDPRA, Rabiu Umar, disclosed this yesterday while announcing the second edition of the West Africa Refined Fuel Conference, scheduled to hold in Abuja from August 11 to 12, 2025.
Umar, who is the Chairman of West Africa Regulators Forum (WARF), said the conference would focus on attracting investments into critical infrastructure needed to support a competitive regional petroleum products market.
He stressed that although Africa produces significant volumes of hydrocarbons, pricing for much of its petroleum commodities continues to be determined outside the continent, a situation the authority believes must change.
According to him, the conference, organised by the NMDPRA in collaboration with S&P Global Commodity Insights and the West Africa Regulators Forum, will bring together regulators, investors, financial institutions and industry leaders to develop practical solutions for financing infrastructure and logistics that will underpin a transparent West African pricing and trading hub.
“The vision is to establish West Africa as a credible regional marketplace where petroleum products can be traded efficiently, transparently and competitively. By strengthening infrastructure, harmonising regulations and improving market data, the region can enhance price discovery, facilitate cross-border trade and attract greater investment,” Umar stated.
He noted that the initiative had recorded significant milestones since the inaugural conference held in July 2024, including the establishment of the West Africa Regulators Forum, publication of West African reference prices and the establishment of an S&P Global Commodity Insights regional office in Abuja.
According to him, the 2025 conference will seek to facilitate knowledge exchange on market trends, identify infrastructure gaps and investment opportunities, strengthen partnerships for market transparency and security of supply, explore the establishment of a credible African petroleum price benchmark and examine strategies for expanding refining capacity across the continent.
Umar identified investment opportunities across the downstream value chain to include gas processing and transportation infrastructure, petroleum storage facilities, pipeline networks, marine terminals, digital commodity exchanges, trading platforms, strategic petroleum reserves, liquefied natural gas infrastructure and logistics corridors.
He argued that regulators have a central role in creating the right environment for investment by ensuring fair competition, market transparency, consumer protection and regional cooperation.
The NMDPRA boss maintained that efficient markets cannot exist without efficient infrastructure, noting that investments in pipelines, storage terminals, ports, rail systems, road networks, refineries and digital trading platforms would reduce logistics costs, strengthen energy security and deepen regional integration.
He added that reliable market data remained critical to transparent pricing, informed investment decisions, risk management and evidence-based regulation.
Expected outcomes of the conference, he said, include new investment partnerships, infrastructure financing initiatives, stronger collaboration among regulators, enhanced regional cooperation, policy recommendations, roadmaps for logistics and trading infrastructure as well as increased private sector participation.
Responding to questions from journalists, Umar explained that every major energy-producing region in the world has developed its own pricing benchmark, citing Europe’s Amsterdam-Rotterdam-Antwerp (ARA) trading hub as an example.
According to him, regional price benchmarks reflect local supply and demand conditions, logistics costs and market realities, making them more suitable than relying on pricing mechanisms developed elsewhere.
“The whole point of having a regional pricing benchmark is to create a hub where activities within a given region are concentrated. The process starts with price discovery and takes into account demand and supply, logistics costs and other market fundamentals before arriving at a reference price that reflects that particular market,” he said.
He added that Africa’s growing refining capacity makes the establishment of its own benchmark increasingly necessary.
“The more we are able to refine our own products, the more relevant it becomes to have our own reference pricing and create that competitive advantage, particularly within the West African region,” Umar noted.
On infrastructure, he described investments in logistics as the single most important requirement for building an integrated regional petroleum market.
“You can produce anything you want, but if you cannot move it to the market, then there is a problem. Infrastructure is what connects production to markets,” he said, pointing to the West African Gas Pipeline as an example of how shared infrastructure facilitates regional energy trade.
He also emphasised the need for harmonised fuel specifications across the region, saying differences in product standards currently limit cross-border trade in refined petroleum products.
According to him, progress is already being made through ECOWAS and the African Refiners Association towards standardising fuel quality specifications.
Umar stated that Nigeria currently does not produce petroleum products with sulphur content above 50 parts per million (ppm), describing locally refined fuels as compliant with international specifications and, in many cases, of higher quality than products supplied by some neighbouring countries.