Middle East turmoil spurs Africa energy self-reliance

Middle East supply disruptions are accelerating Africa’s drive to expand domestic refining and production as governments and companies seek to reduce exposure to volatile fuel costs and vulnerable shipping routes.

Disruption around the Strait of Hormuz and Red Sea has pushed energy markets higher, raising import bills across a continent where most countries remain net buyers of crude or refined petroleum products. The African Development Bank says 43 of Africa’s 54 countries are net importers of crude oil or petroleum products, leaving them exposed to price spikes, currency weakness and transport inflation.

That vulnerability is accelerating investment across refining, upstream production, storage and logistics. Dubai-headquartered Sancorp Group is among companies seeking to expand that commercial bridge between Gulf capital and African energy assets, while expanding around local production and processing.

Sancorp said this month that it intends to increase direct investment in Angola and is in advanced discussions to acquire minority interests in two producing deepwater blocks. The group is also seeking an equity stake in one of Angola’s planned refineries, extending beyond trading into ownership of production and downstream infrastructure.

Chief executive Efe Tunde-Imoyo identified the Lobito Corridor as a strategic route for Sancorp’s regional expansion. The company says it has structured more than $2 billion in African oil and gas investments across Angola, Côte d’Ivoire, Ghana and Nigeria.

Its expansion comes as African policymakers place greater emphasis on refining crude closer to where it is produced. Nigeria’s Dangote refinery has already reduced the country’s dependence on imported petrol while increasing exports of diesel and jet fuel, showing how large-scale domestic processing can alter regional supply patterns during global disruptions.

The International Energy Agency says the Middle East conflict has produced a major global energy supply shock. Around a quarter of global seaborne oil trade passed through the Strait of Hormuz in 2025, while roughly one-fifth of global liquefied natural gas trade used the same route. Disruptions have therefore transmitted quickly into fuel, shipping and fertiliser prices.

African economies face an uneven impact. Oil producers can benefit from higher export prices, but limited refining capacity and ageing infrastructure mean several still import substantial volumes of finished fuels. Import-dependent economies face a more direct hit through higher pump prices, larger trade deficits and pressure on foreign exchange reserves.

A joint assessment by the African Development Bank, African Union Commission, United Nations Economic Commission for Africa and United Nations Development Programme estimated that the Middle East crisis could trim Africa’s economic growth by as much as 0.2 percentage points in 2026. The institutions also warned of higher food and fertiliser costs as energy disruptions spread through transport and agricultural supply chains.

East Africa is particularly exposed because it depends heavily on Gulf crude and refined fuel. The African Development Bank has estimated that the region obtains more than three-quarters of its crude imports from the Gulf, making diversification of suppliers, storage and domestic processing increasingly important.

West Africa is moving in a different direction as new refining capacity changes trade flows. Dangote’s 650,000-barrel-a-day refinery has supplied domestic markets while also sending products abroad, and stronger regional refining could reduce dependence on cargoes routed from Europe or the Middle East.

Sancorp’s activities reflect that shift towards integrated supply chains. The company says Côte d’Ivoire is its largest market, with projected annual flows above $600 million across refined products, crude, liquefied petroleum gas and fertiliser. It delivered more than 36,000 tonnes of gasoil to the Abidjan terminal of Société Ivoirienne de Raffinage in July.

Ghana has also featured in the group’s trading business, while its Nigeria subsidiary provides upstream services and maintains commercial links with the Dangote refinery. In Angola, Sancorp is registered with state oil company Sonangol as it pursues participation in producing assets.