Afreximbank has committed $3 billion to finance the purchase of refined products within Africa as part of efforts to increase the continent’s refining capacity.
Africa currently exports around 80% of its crude oil and 45% of its natural gas, making it heavily reliant on imported refined products, according to the bank.
Sub-Saharan Africa’s energy landscape is marked by inadequate storage infrastructure and aging refineries with limited output capacity, hindering the region’s ability to meet its growing energy demands efficiently, according to Reuters.
“The time has come for Africa to take control of its energy destiny,” Executive Vice President, Kanayo Awani, at Afreximbank told an energy conference in Cape Town, South Africa on Monday.
Awani said the $3 billion revolving intra-African oil importing financing initiative willbe used for products including premium motor spirit, automotive gas oil, heavy fuel oil, jet fuel, and kerosene, among others.
Afreximbank, a key investor in the 650,000 barrels per day Dangote refinery in Nigeria, as well as the Lobito and Cabinda refineries in Angola, has historically financed the importation of refined products into Africa from outside the continent.
Recall Afreximbank is also playing a key role in the creation of the Africa Energy Bank, a new financial institution with an initial capitalization of $5 billion.
The AEB is focused on tackling funding challenges in Africa’s energy sector, particularly in oil and gas projects.
Afreximbank is collaborating with the African Petroleum Producers’ Organization, which comprises 18 oil-exporting African nations, to bring the AEB initiative to life.
“Our goal is to support 3 million barrels per day of refining capacity in the near to medium term, that is our ambition,” Awani told Reuters.
Meanwhile, oil prices fell to a near four-year low yesterday amid concerns that U.S. President Donald Trump’s latest round of trade tariffs could lead to a global recession, reducing worldwide demand for energy.
Brent futures were down 79 cents, or 1.2 per cent, to $64.80 per barrel, while U.S. West Texas Intermediate (WTI) crude futures were down 75 cents, or 1.2 per cent, to $61.24. That put both benchmarks on track for their lowest closes since April 2021, the report stated.
