Nigeria’s improving economic outlook has been linked to the operational success of the Dangote Petroleum Refinery & Petrochemicals and a series of key economic reforms, following the country’s recent sovereign credit rating upgrade by S&P Global Ratings.
In its latest assessment, S&P upgraded Nigeria’s long-term foreign and local currency sovereign credit ratings from “B-” to “B”, citing stronger economic growth, improved external balances, rising oil production, and expanded domestic refining capacity as major drivers of the recovery.
The ratings agency identified the ramp-up of the 650,000 barrels-per-day Dangote refinery as a significant contributor to Nigeria’s improving balance of payments position and broader economic resilience.
According to the report, the refinery’s near full-capacity operations are helping to strengthen Nigeria’s current account surplus, reduce dependence on imported refined petroleum products, and improve foreign exchange liquidity.
“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,” S&P stated.
The agency projected that Nigeria’s current account surplus would rise to 5.8 per cent of Gross Domestic Product (GDP) in 2026, up from 4.8 per cent in 2025, supported partly by increased domestic refining activities and hydrocarbon exports.
S&P noted that the refinery is helping to ensure the availability of refined fuel, gas, and fertiliser in the domestic market while providing a buffer against global supply disruptions linked to geopolitical tensions in the Middle East.
The report further stated that Nigeria’s external position has improved due to reduced fuel import dependence, the removal of fuel subsidies, exchange rate liberalisation, and increased oil production.
According to the agency, Nigeria’s foreign exchange reserves have increased from about $33 billion in 2023 to nearly $50 billion by early 2026, aided partly by lower import demand for refined petroleum products following the commencement of operations at the refinery.
S&P also highlighted the refinery’s role in advancing Africa’s industrialisation ambitions, noting that Nigeria is gradually transitioning from being primarily a crude oil exporter to an emerging producer and exporter of refined petroleum products.
The report disclosed that Dangote Industries Limited has unveiled plans to undertake feasibility studies aimed at expanding refining capacity to about 1.4 million barrels per day from the current 650,000 barrels per day.
According to the agency, the proposed expansion, alongside the rehabilitation of other local refineries, could further strengthen Nigeria’s economy and improve the country’s balance of payments position in the coming years.
While acknowledging that global crude oil prices and market-driven pricing continue to affect domestic fuel costs, S&P maintained that increased local refining capacity provides Nigeria with stronger energy security and reduced exposure to external supply shocks.
The report also linked Nigeria’s improving macroeconomic outlook to reforms introduced since 2023, including exchange rate liberalisation, fiscal reforms, higher petroleum revenue remittances, and efforts to boost oil production through enhanced security in the Niger Delta.
S&P said Nigeria’s economic growth is expected to remain resilient despite inflationary pressures, with ongoing reforms continuing to support investor confidence and expansion in the non-oil sector.
The agency added that the stable outlook reflects a balance between Nigeria’s improving external position and persistent structural challenges such as a narrow tax base, high inflation, and low formal employment levels.
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