Analysis examines Africa's potential to benefit from Hormuz Strait disruption through energy exports

As military tensions in the Strait of Hormuz disrupt global energy markets, European nations are turning to African producers like Algeria, Nigeria, and Angola to diversify their oil and gas supplies. However, structural weaknesses, including limited refining capacity and production constraints, prevent African exporters from fully capitalizing on high global prices. Many of these nations remain vulnerable to domestic inflation and fiscal strain due to their reliance on imported refined fuels.

Hormuz Strait energy disruption

• ▪Military tensions in the Strait of Hormuz are disrupting international energy markets, with global economic growth and trade volumes projected to decelerate in 2026.
• ▪Alternative pipelines through Saudi Arabia and the United Arab Emirates accommodate only approximately one-quarter of the energy volumes that typically transit the Strait of Hormuz.

European diversification to Africa

• ▪European nations, specifically Italy, Spain, and France, are seeking to secure North and West African oil and gas supply lines to replace Persian Gulf flows.
• ▪Angola's long-term energy production outlook was strengthened by an offshore discovery of an estimated 500 million barrels announced by Eni and BP in February 2026.

African production capacity limits

• ▪African energy exporters face a divergence between rising fiscal receipts from high global prices and eroding domestic stability due to internal volatility.
• ▪Most African energy exporters are operating close to capacity or face declining output due to underinvestment, limiting their ability to scale production.

Refining gaps fuel imports

• ▪Limited refining capacity across African economies forces governments to absorb price shocks through subsidies or pass them to consumers, intensifying fiscal pressure.
• ▪Many African energy exporters export crude oil but import refined fuels, exposing domestic markets to rising global prices for gasoline and diesel.

Algeria pipeline export constraints

• ▪Algerian oil exports to Spain doubled to 116,000 barrels per day earlier in 2026, while shipments to the United States rose over 40 percent to 102,000 barrels per day.
• ▪Algeria's ability to scale energy exports is capped because its production capacity is stretched and its pipeline infrastructure is operating at near-full capacity.

Nigeria Dangote refinery pricing

• ▪Nigeria's crude oil production declined by 10.6 percent in February 2026, preventing the country from capitalizing on crude prices surging above $100 per barrel in the spring of 2026.
• ▪Despite the Dangote refinery's capacity, Nigerian gasoline prices rose 47 percent as the refinery adjusted prices in step with international pricing benchmarks.