Escalating conflict in the Middle East poses a direct threat to around 14 million barrels per day, or 32% of global seaborne crude oil, that flows through the Strait of Hormuz. For oil products, any Strait of Hormuz disruption would impact 16% of the global products trade, with severe consequences for LPG (liquefied petroleum gas) and naphtha.

Any disruption to tanker transits through the strait would cripple the global trade of oil and oil products.

Strait of Hormuz transit volumes are about 1.5 million barrels per day (b/d) for LPG and 1.2 million b/d for naphtha. Naphtha flows to East Asian crackers are particularly exposed, with more than 37% of those global seaborne volumes transiting the strait.

LPG markets are already tight following last week’s outage at Saudi Aramco’s Juaymah facility. This poses a specific threat to India, which relies heavily on Middle Eastern LPG for residential use. Replacing these short-haul cargoes with longer voyages of LPG from the US would present a severe logistical challenge for countries in Asia.

For middle distillates, diesel flows through the strait are roughly double those of jet fuel. But jet is more vulnerable in terms of overall market share. European jet kerosene buyers are particularly sensitive, as more than half of the continent’s jet fuel imports sail through this strait. In the event of sustained disruption, Europe would need to pivot to alternative suppliers such as India, South Korea, the US, and even Nigeria’s new Dangote refinery.

A similar dynamic also applies to diesel due to Europe’s sanctions on oil products from Russia. As Europe pulls more non-Russian barrels of diesel from the global pool, African buyers may increasingly turn to Russian diesel to fill their gap. Russian refinery throughput fell to 5.15 million barrels per day (b/d) during the first 18 days of February 2026 due to continued Ukrainian drone attacks. Russian refined product exports declined by 270,000b/d over the same period, led by lower fuel oil and diesel exports.

NIPCO Gas Limited and the NNPC Gas Marketing Limited are expanding gas infrastructure projects across the South Western part of Nigeria, aiming to boost industrial and commercial economic growth of the region.

Both parties have consolidated gas supply agreements that will further expand adoption of gas as alternative energy sources for commercial activities.

NIPCO Gas, the major driver of the energy supply chain has outlined an expansion strategy spanning pipeline infrastructure, city gas distribution networks and nationwide Compressed Natural Gas (CNG) rollout, positioning itself at the forefront of Nigeria’s domestic gas drive under the reform framework of the Petroleum Industry Act (PIA).

The Managing Director of the company, Nagendra Verma, while speaking in the ongoing projects across the South West and other parts of the country, described natural gas as central to energy security, industrial competitiveness and macroeconomic stability in the post-subsidy era.

He said Nigeria’s energy landscape is undergoing structural transformation driven by regulatory clarity introduced by the PIA and renewed government emphasis on domestic gas utilisation.

Verma, the improved governance framework and issuance of gas distribution licences have strengthened investor confidence across the oil and gas value chain, encouraging long-term infrastructure commitments.

With fuel subsidy removal and fiscal restructuring reshaping the downstream market, gas is increasingly being positioned as a stabilising alternative to imported fuels, reducing exposure to global price volatility while supporting manufacturing and commercial activity.

According to him, NIPCO Gas is constructing an 18-inch, 80-kilometre natural gas pipeline from Sagamu to Ibadan.

The project, scheduled for completion between June and July 2026, is expected to significantly boost gas availability to industries in Ogun and Oyo states as well as adjoining areas.

The MD noted that the infrastructure will reduce energy costs for manufacturers currently dependent on alternative fuels such as diesel and low-pour fuel oil, improve production efficiency and strengthen the competitiveness of Southwest industrial clusters.

Given the strategic importance of the pipeline to regional industrialisation and national energy security, NIPCO Gas called for sustained cooperation from federal and state authorities to ensure seamless delivery.

Beyond Ibadan, he said the company is extending gas distribution infrastructure from Sagamu to Abeokuta, also in Ogun State, as part of efforts to deepen gas penetration in the Southwest.

According to him, the Abeokuta expansion is expected to attract fresh manufacturing investments, enhance reliability of energy supply to existing businesses and strengthen internally generated revenue within the state. The project, he said, has received backing from the Ogun State Government, reflecting alignment between public policy and private sector infrastructure deploymentHe added NIPCO Gas has developed gas distribution infrastructure within the Lekki Free Trade Zone, reinforcing energy access for industries operating in the fast-growing economic corridor.

“The Lekki axis has emerged as a major hub for export-oriented and heavy industrial investments, and reliable gas supply is considered critical to sustaining operations, lowering production costs and maintaining competitiveness.

By strengthening energy reliability in the zone, the company said it is contributing to Lagos State’s position as a leading industrial and commercial centre”.

In alignment with the Federal Government’s clean energy and post-subsidy transport reform agenda, Verma said NIPCO Gas, in joint venture with NGML, is constructing 20 additional CNG stations across Nigeria.

“In addition, CNG mother stations located in Lekki and Ore are at advanced stages of completion. These facilities will function as primary compression and dispatch hubs, supplying daughter stations and industrial customers through a mother–daughter network model, particularly in areas not directly connected to pipeline infrastructure.

The nationwide rollout is strategically targeted at high-traffic urban centres and major transport corridors, improving accessibility and affordability of CNG for fleet operators, mass transit systems, commercial drivers and private vehicle owners,’’.

According to him, all facilities are being developed in compliance with Nigerian regulatory standards and international safety best practices.

Beyond fuel substitution, he stressed that the expansion is expected to stimulate job creation across construction, operations and ancillary mobility services, lower transportation costs, reduce carbon emissions and improve air quality in major cities.

The NIPCO Gas boss said its sustained investments in trunk pipelines, city gas networks and CNG infrastructure are designed to strengthen national energy security, promote domestic gas utilisation and support Nigeria’s broader economic diversification agenda.

The company emphasised that transparency and stakeholder engagement remain central to its operations, noting that collaboration with regulators, sub-national governments and the media will be critical in sustaining momentum within the gas sector.

Dawes Island Marginal Oil Fiield has secured 109 million dollars lending facility with Toronto-based REIN Capital to boost its operations.

Odjegba Onoriode, the Managing Director of Eurafric Energy, disclosed this in a statement on Mond-ay in Lagos.

According to Onoriode, the funding is a significant financial boost for the development of the Dawes Island marginal field.

He said that the move signals a major step for operator Eurafric Energy, following a recent court ruling that restored the company’s ownership of the asset.

Onoriode disclosed that the financing initiative was backed by prominent Bay Street financier, Michael Wekerley, a co-founder of the well-known Canadian investment bank, GMP Securities.

According to him, the facility was originally processed for Eurafric Energy prior to the asset’s revocation in 2020.

“Following a Federal High Court decision that reversed that revocation, the funding commitment has now been formally reactivated.

“This reflects continued investor confidence in the field’s underlying reserves and commercial viability following extensive technical due diligence conducted before the legal interruption.

“Structured Plan Targets 20,000 BOPD. With the funding in place, Eurafric Energy has outlined a comprehensive development roadmap for Dawes Island Marginal Field,” he said.

He said that the plan prioritises scaled and sustained output over rapid-cycle early oil, underpinned by the newly secured structured financing.

He added that the development strategy included, spudding five new development wells, a phased production ramp-up.

Other development includes the deployment of permanent production and evacuation facilities.

Onoriode said that the medium-term production target is around 20,000 barrels per day.

He said that the reinstated facility would cover drilling, completion, field facilities, and necessary working capital to transition the field to expanded production mode.

He added that beyond the immediate development financing, REIN Capital had disclosed wider plans to position Eurafric Energy for a listing on the Canadian Securities Exchange (CSE).

“Market watchers view the proposed listing as a signal of long-term ambition, a move that will provide enhanced transparency and access to deeper international capital pools.

“It comes at a time when global investors are increasingly seeking exposure to structured African upstream opportunities backed by reserves-based lending frameworks.”

Okoro Rig mobilisation Signals Strength of Indigenous Energy Sector – CEO

AMNI International Petroleum Development Company says the arrival of a drilling rig at Okoro Field reinforces confidence in Nigeria’s indigenous oil and gas industry.

Its Chairman and Chief Executive, Dr Tunde Afolabi, in a statement issued on Sunday in Lagos, said that the mobilisation remained “a defining operational milestone for the company”.

He also said the campaign “reflects the growing technical capability, capital strength and ambition of Nigeria’s indigenous operators”.

Afolabi explained that Okoro Field, a core producing asset, is undergoing development to optimise output and enhance reservoir management.

“The objective is to sustain our base production and increase peak output to over 12,000 barrels per day,” he said.

According to him, the three-well campaign forms part of AMNI’s five-year Strategic Development Plan.

“Our strategy prioritises production optimisation, accelerated oil development and expanded gas commercialisation across our portfolio,” Afolabi stated.

He disclosed that beyond Okoro, AMNI and its partners maintain a forward asset development pipeline exceeding 2.5 billion dollars.

“That portfolio represents a significant long-term investment, with expected peak production above 150,000 barrels of oil equivalent per day,” he said.

Afolabi noted that the capital commitment demonstrates disciplined deployment within Nigeria’s upstream sector.

“This is not symbolic expansion; it is tangible execution against a clearly defined long-term strategy,” he added.

He stressed that sustainable growth for indigenous operators must be grounded in sound fundamentals.

“Operational excellence, prudent capital allocation and long-term value creation remain the pillars of our growth model,” Afolabi said.

He added that AMNI’s continued investment aligns with the Federal Government’s aspiration to raise national production towards three million barrels per day.

“Indigenous companies are now central to sustaining output, extending field life and ensuring reinvestment within the domestic economy,” he stated.

Looking ahead, Afolabi said the company would advance the Tubu oil field and accelerate gas development initiatives.

“The mobilisation at Okoro signals resilience, confidence and our enduring commitment to Nigeria’s upstream future,” he said.