General Manager, Aviation at Ardova Plc, Toyin Leo-Olagbaiye, has said Nigeria’s aviation fuel market has witnessed a major transformation following the commencement of production at the Dangote Refinery, ending the persistent Jet A1 scarcity that previously disrupted airline operations, although pricing remains vulnerable to global crude oil markets, foreign exchange movements and geopolitical tensions.
Speaking in an interview, Leo-Olagbaiye explained that while domestic refining has significantly improved supply security, the country remains exposed to international pricing dynamics because Jet A1 is still priced against global benchmarks.
According to him, Lagos remains the country’s biggest aviation fuel market, accounting for between 60 and 70 per cent of all Jet A1 supplied directly into aircraft nationwide.
“Lagos is the dominant hub — it accounts for between 60 and 70 percent of all Jet fuel supplied into-plane across Nigeria,” he said.
Highlighting the scale of fueling operations, he added: “As for a single uplift, the range is striking. It varies enormously depending on the aircraft type, destination, fuel on arrival, and weight considerations. To put it in perspective: a Boeing 747 freighter flying a direct route to Rio de Janeiro can take as much as 130,000 litres in a single uplift. At the other end of the spectrum, a Phenom 300E heading to Abuja might uplift as little as 1,000 litres. That range — 1,000 to 130,000 litres — captures the complexity and diversity of fueling operations we manage daily.”
Leo-Olagbaiye described the emergence of the Dangote Refinery as the biggest development in Nigeria’s aviation fuel supply chain in recent years.
“The most significant recent development in Nigeria’s Jet A1 supply landscape has been the Dangote Refinery as against imports in the past. It is now the main source of Jet A1 in the country, and its impact has been transformative — particularly in resolving the scarcity problem that once plagued the market,” he said.
He explained that before the refinery began operations, the market was affected by both shortages and rising prices.
“Before Dangote came on stream, the Nigerian market was susceptible to two compounding challenges: the price problem and the scarcity problem. Today, while price pressures remain because Dangote still sources part of its crude from the global market, the availability crisis that previously disrupted airline operations has been significantly addressed.”
Leo-Olagbaiye also noted that the presence of numerous marketers has strengthened competition within the industry.
“There are a high number of players involved in jet fuel supply in Nigeria, and that level of competition is ultimately beneficial — it keeps the market honest and works in favour of the airlines and the flying public.
“The current structure is transparent and allows players to maintain full value chain control, which is an important efficiency driver.
“Scale and integration matter in this business, and that is why at Ardova Plc, we have invested heavily in structures that allow us to manage the full chain from vessels and tankers to bowsers for wingtip sales to deliver the best outcome for end users.”
On pricing, Leo-Olagbaiye said Nigeria’s aviation fuel market closely follows international benchmarks, particularly Northwest Europe (NWE) Platts prices.
“They are highly relevant. The Northwest Europe (NWE) Platts reported prices trend closely with pricing realities in Nigeria because the same market is referenced for Jet A1 sourcing locally. So, when NWE prices move, Nigerian prices follow. There is a direct correlation, and any operator or airline finance team that tracks NWE Platts will have a reasonably accurate forward-looking view of what to expect in the Nigerian market.”
Discussing the role of foreign exchange, he said improved stability in Nigeria’s FX market has reduced the uncertainty previously associated with aviation fuel imports.
“We still need FX to buy Jet fuel, pricing is basis international benchmarks in USD, the difference between then and now is the availability and stability.
“In the past, you would issue an LC to the international traders for your cargo and deal with sourcing the FX to pay the liquidate the line this LC is issued on, because of the instability in FX prices, many times cargoes you assumed you sold at a profit goes negative because margins were eroded by growing interest payments on the line due to unavailability of FX or an unexpected spike in the FX price. However, while we still have to pay with FX for jet fuel, the stability in FX rates means less surprises in the economics of your cargoes.”
Reacting to the impact of tensions in the Middle East on global aviation fuel prices, Leo-Olagbaiye said the increase in international prices has also affected Nigeria, while local logistics further raise costs.
“Reduced supply and increased demand are primary drivers globally, but the Nigerian context has its own structural cost layer. One of the most important is logistics infrastructure.
“In Nigeria, we rely on road tankers to move Jet A1 to various airports across the country. When diesel prices rise — as they have — trucking costs increase, and that feeds directly into the final price of aviation fuel at the point of delivery.
“Some of the African markets we are often compared to have the advantage of pipeline infrastructure for moving Jet fuel to airports. Pipelines are significantly more cost-efficient than road transport at scale, and that structural advantage can account for meaningful price differences between markets. It is not simply a question of crude prices — it is about the full cost of getting fuel safely and reliably to the wing of an aircraft.”
He, however, credited the Dangote Refinery with helping to cushion the country from supply disruptions.
“Availability and distribution have not been as severely affected as they would have been in the pre-Dangote era. The refinery has provided a crucial domestic buffer that insulates the Nigerian market from the worst supply disruptions that geopolitical tensions would otherwise trigger.”
Despite improved availability, he warned that prices have risen sharply.
“Pricing pressure has been considerable. We are in a world where prices have more than doubled (2.5X–3X) from $600–$700 per MT before the US-Iran war to over $1,800 per MT on some days. Also, premiums have grown considerably. While the supply is available, there is a big price pressure that needs to be dealt with.”
Looking ahead, Leo-Olagbaiye said Nigeria’s supply outlook remains positive because of domestic refining capacity, but stressed that pricing would continue to be dictated by global events.
“Nigeria can continue to rely on Dangote for supply security, but we are still subjected to global geopolitics and its influence on prices. Hopefully, the war ends and prices can relax to pre-war times.
“Prices are a subject of demand and supply, so while you may have your local supply, you need to understand that when there is an event affecting the global supply, there is a demand pressure on your own product as well. Those who cannot access their own supply will come for your own local supply and offer even higher prices because they can and because they need the product. In summary, we are always going to be at the mercy of global events in terms of pricing. Everything goes back to demand and supply economics.”
On operational standards, Leo-Olagbaiye said Ardova Plc adheres strictly to internationally recognised aviation fuel handling procedures to guarantee safety and quality throughout its supply chain.
“The nature of aviation demands absolute consistency. An aircraft can uplift fuel from three different continents within a 24-hour window, which means the same specification of fuel must be supplied regardless of location. That reality is why Jet Fuel specification and handling requirements are determined on the global stage.
“Our Jet Fuel specification is in line with the latest issue of the UK Ministry of Defense Standard (DEF-STAN 91-091). Beyond that, Ardova Plc follows all Jet Fuel handling requirements as furnished by the Joint Inspection Group (JIG) and the International Air Transport Association (IATA), alongside domestic NMDPRA/NCAA regulations. Compliance is not optional in this industry — it is the foundation of every operation we run.”
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