Abuja: The Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) has called for the creation of a regional oil pricing benchmark for West Africa. The aim is to reflect the region’s unique market dynamics and reduce dependence on foreign pricing templates.
According to News Agency of Nigeria, Mr. Farouk Ahmed, the Authority Chief Executive, made the call in Abuja at the inaugural Global Commodity Insights Conference on West African Refined Fuel. The event was convened by NMDPRA in collaboration with S and P Global Commodity Insights. Ahmed warned that continued reliance on international benchmarks could hinder the development of a robust and self-sufficient regional energy market.
Despite being a significant producer of hydrocarbon resources and a growing hub for refining, West Africa still depends on posted prices from global reference markets for its trading activities. These include benchmarks from regions such as Northwest Europe, the U.S. Gulf Coast, the Mediterranean, Singapore, and the Arab Gulf. While these benchmarks are globally accepted, they often do not reflect the supply chain peculiarities and economic realities of the African continent.
Ahmed stated that the creation of a regional pricing benchmark would promote price discovery, enhance transparency, deepen market development, and improve energy availability. It would also encourage investments in downstream infrastructure through trade zones, digital market platforms, and increased supply chain visibility.
The conference focused on standardising pricing mechanisms, improving data transparency, and expanding refining and storage capacity across the region. Ahmed noted that refining capacity in countries like Nigeria, Ghana, Niger, Senegal, and C´te d’Ivoire currently stands at 1.335 million barrels per day.
