Dr. Mustapha Abdul-Hamid, President of the African Refiners and Distributors Association (ARDA), has urged Africa’s 54 countries to move away from pricing petroleum products in U.S. dollars. Speaking at the African Energy Week in Cape Town, South Africa, he stressed the importance of building integrated infrastructure to secure Africa’s energy future independently of developed nations.

Dr. Abdul-Hamid argued that reducing reliance on foreign currencies in energy transactions would stabilize African economies, reduce import costs for energy, and promote long-term energy independence. He also proposed halting crude oil exports from Africa until the continent can meet its own energy needs, given its rapidly growing population.

Emphasizing the need for local refining, he stated, “No one uses crude oil directly for transportation or industry – all energy that fuels movement and creates wealth is refined.” He called for closer collaboration between Africa’s upstream and downstream energy sectors to fully leverage the continent’s resources.

To advance energy independence, Dr. Abdul-Hamid proposed a three-part strategy: policy harmonization, infrastructure integration, and the adoption of regional currencies. He noted that inconsistent fuel quality standards across African countries impede regional trade. For example, Ghana’s sulfur limit is 50 parts per million (ppm), while some nearby countries allow levels up to 3,000 ppm, making fuel imports challenging.

“Without unified specifications across Africa, intra-continental trade is difficult,” he said, urging cooperation among regulatory bodies, national oil companies, and governments to create a cohesive approach to energy production and distribution. He also highlighted Ghana’s policy mandating locally refined fuel for oil extraction equipment as a model to strengthen domestic refinery output.

Dr. Abdul-Hamid additionally advocated for a regional currency to reduce reliance on the U.S. dollar, pointing out that Ghanaian oil marketers need $400 million monthly to import refined petroleum products, placing strain on the Ghanaian Cedi. A shared currency within regional economic communities, he suggested, could relieve this pressure.

Supporting these views, Omar Farouk Ibrahim, Secretary General of the African Petroleum Producers Organisation (APPO), called for stronger infrastructure within Africa to minimize dependency on foreign markets. He warned that relying on imports leaves African nations vulnerable to sanctions and supply disruptions.

“Despite our continent’s vast resources, we still depend on imported energy,” Ibrahim said, emphasizing the need for partnerships among neighboring countries to build essential infrastructure and ensure energy security.

Riverson Oppong, Chief Executive of the Association of Oil and Gas Marketing Companies, highlighted the irony of Africa exporting crude oil while lacking sufficient refined products for its own needs. With nearly 90 percent of Africa’s crude exported, he noted, the continent is stuck in a cycle of exporting raw materials only to re-import finished products at a premium, undermining economic stability.

Oppong questioned this approach, citing a large, underutilized refinery in Morocco with a capacity of 550,000 barrels per day. “Why send crude oil to Europe for refining, only to bring it back to Africa at a higher price?” he asked, urging African nations to invest in domestic refining capacity to bolster energy self-sufficiency.

Source:TheDotNews