$2.91 Jump in Brent Crude Spills Over to Dangote Refinery Pricing Worries
Brent crude rose $2.91, surpassing the $98 per barrel mark and triggering concerns that Nigeria's Dangote Refinery will raise product replacement costs.
Crude oil markets moved sharply higher on Tuesday, with benchmarks rising nearly 4 percent in two trading sessions. Brent crude gained $2.05 to trade at $98.05 per barrel by mid-morning West Africa Time, while West Texas Intermediate added $2.91 to reach $94.39. Industry observers noted these gains were occurring at a pace that suppliers found difficult to absorb without shifting costs to buyers downstream. In Nigeria, this surge raised specific fears regarding fuel prices at the pump. An anonymous industry source stated that benchmarks require factor-in for replacement cost and might review prices very soon. That person confirmed management was weighing the impact of higher costs on consumer purchasing power before deciding on any adjustment at the Dangote Refinery. The refinery currently assesses how to balance margin protection with maintaining demand in a market already facing price sensitivity.
