The S&P Global Ratings has identified the Dangote Petroleum Refinery & Petrochemicals as a major driver of Nigeria’s improving economic outlook following the country’s recent sovereign credit rating upgrade.
In its latest assessment, S&P upgraded Nigeria’s long-term foreign and local currency sovereign credit ratings to “B” from “B-”, citing stronger economic growth, improved external balances, rising oil production, and expanded domestic refining capacity as key factors supporting the country’s economic recovery.
According to the ratings agency, the operational ramp-up of the 650,000 barrels-per-day refinery is significantly improving Nigeria’s balance of payments position and strengthening broader economic resilience.
S&P noted that the refinery’s near full-capacity operations are helping to reduce Nigeria’s dependence on imported refined petroleum products, improve foreign exchange liquidity, and strengthen the country’s current account surplus.
“Significant refining capacity is now also online; Dangote Industries Ltd.’s large-scale refinery and petrochemical complex has ramped up to near its maximum capacity of 650,000 barrels per day,” the report stated.
The agency projected that Nigeria’s current account surplus would rise to 5.8 per cent of Gross Domestic Product in 2026, compared to 4.8 per cent in 2025, supported partly by increased domestic refining activities and hydrocarbon exports.
S&P also stated that the refinery is helping to guarantee the availability of refined petroleum products, gas, and fertiliser within the domestic market while reducing the country’s vulnerability to global supply disruptions linked to geopolitical tensions in the Middle East.
According to the report, Nigeria’s foreign exchange reserves have risen from about $33 billion in 2023 to nearly $50 billion by early 2026, partly due to lower fuel import demand following the commencement of operations at the refinery.
The agency further highlighted the refinery’s broader strategic importance to Africa’s industrialisation agenda, noting that Nigeria is gradually transitioning from being primarily a crude oil exporter to becoming a producer and exporter of refined petroleum products.
S&P disclosed that Aliko Dangote-led Dangote Industries has unveiled plans to conduct feasibility studies for an expansion of refining capacity from 650,000 barrels per day to about 1.4 million barrels per day.
According to the agency, the planned expansion, alongside the rehabilitation of other local refineries, could further strengthen Nigeria’s economy and improve the country’s external financial position in the coming years.
While acknowledging continuing challenges such as inflation, a narrow tax base, and low formal employment levels, S&P maintained that ongoing reforms, including exchange rate liberalisation, fiscal adjustments, subsidy removal, and improved oil production, are supporting investor confidence and economic stability.
