Middle East and Africa Oil Refining Market Outlook, 2030

Historically, countries like Saudi Arabia, the UAE, and Kuwait invested heavily in expanding their refining capacities, transforming the region from crude exporters into major players in the export of refined petroleum products. Refineries such as Saudi Arabia's Ras Tanura, the UAE’s Ruwais, and Kuwait’s Al-Zour, which recently became operational, now rank among the largest globally. Meanwhile, Africa, despite being rich in crude oil resources, long suffered from inadequate refining infrastructure, resulting in a heavy reliance on imported refined fuels. However, the landscape is changing with massive investments like Nigeria’s Dangote Refinery, which began operations in 2023 with a capacity of 650,000 barrels per day, aiming to eliminate the country’s fuel import dependence and even supply neighboring nations. Demand for refined fuels in MEA continues to rise due to rapid urbanization, industrialization, and population growth, particularly in sub-Saharan Africa and the Gulf states. For instance, Saudi Aramco and ADNOC promote refined exports to Asia and Europe, leveraging branding and strategic partnerships. In April 2025, Middle East oil refineries added 618,000 b/d of production capacity by 2029, transforming the region into a net exporter equal to about 6 million b/d by 2030 and approaching 7 million b/d by 2040. Moreover, the shift in OPEC+ strategies has seen Gulf nations focusing more on refined product exports, which reached 5.5 million barrels per day in 2024, up 7% from the previous year. Policies like Nigeria’s Petroleum Industry Act of 2021 have eased regulatory bottlenecks and encouraged foreign investments, resulting in a wave of new modular and mega-refineries. In May 2023, Kuwait Integrated Petroleum Industries Company (KIPIC) is announcing the successful operation of the third and final unit of Al-Zour Refinery, increasing the country's maximum refining capacity to 615,000 barrels per day. The refinery, located approximately 90 kilometers south of Kuwait City, is one of the largest refineries built in one phase and is designed to process a wide range of Kuwait domestic crude, including Kuwait export crude and Kuwait heavy crude.

According to the research report "Middle East and Africa Oil Refining Market Outlook, 2030", the Middle East and Africa Oil Refining market is anticipated to grow at more than 6.18% CAGR from 2025 to 2030. The push for economic diversification, especially in Gulf Cooperation Council (GCC) countries, has accelerated investments in downstream sectors, including refining, petrochemicals, and clean energy integration. The refining market in the Middle East, for instance, is expanding rapidly due to mega-projects like Saudi Aramco’s Jazan Refinery, Kuwait’s Al-Zour Refinery, and Oman’s Duqm Refinery, all of which are designed to add value to local crude by producing high-grade fuels and petrochemicals for export. The launch of Nigeria’s Dangote Refinery in 2023, Africa’s largest with a capacity of 650,000 barrels per day, is a game-changer that is expected to significantly reduce the continent’s dependence on imported fuels currently over 80% of Africa’s refined fuel is imported and to increase energy security and local job creation. In March 2023, there were advanced discussions in progress between the African Export-Import Bank (Afreximbank) and Senegal's exclusive oil refining company, Société Africaine de Raffinage (SAR), with the aim of securing USD 500 million in syndicated funding to support extensive renovations for the aging refinery. The African Continental Free Trade Area (AfCFTA) agreement, which promotes intra-African trade, also opens opportunities for regional supply chains in refined products. Supporting events such as energy expos, investor forums, and government incentives like tax breaks and public-private partnerships are encouraging local and foreign investments in refining infrastructure. For example, Angola and Uganda have signed multiple international deals to develop new refineries to serve domestic and cross-border demand. In July 2024, in Makran Coasts, southeastern Iran, the opening of the country’s fifth research and technology center for petrochemical industries was announced by the head of Iran’s NPC (National Petrochemical Company) Morteza Shahmirzaei. It helps to upgrade the oil qualification units at oil refineries.

Market Drivers

• Abundant Crude Oil Reserves and Strategic Export Position: The Middle East and Africa region holds some of the world’s largest proven crude oil reserves, particularly in countries like Saudi Arabia, the UAE, Iran, Iraq, Kuwait, and Nigeria. This abundance of feedstock enables the development of large-scale, complex refineries that benefit from economies of scale and strategic proximity to major shipping routes like the Suez Canal and Strait of Hormuz. These advantages allow MEA countries to not only satisfy growing domestic demand but also position themselves as global exporters of refined petroleum products, especially to Asia and Europe.
• Government-Backed Investments and Economic Diversification Efforts: Governments across the region, especially in the Gulf Cooperation Council (GCC) countries, are actively investing in refining capacity as part of broader economic diversification strategies. Initiatives like Saudi Arabia’s Vision 2030 and the UAE’s downstream expansion plans aim to reduce reliance on crude oil exports and create value-added industries. Massive refining projects such as the Jazan and Duqm refineries are being developed or expanded with the support of state-owned oil companies (e.g., Saudi Aramco, ADNOC) and foreign partners, driving growth and modernization in the sector.

Market Challenges

• Geopolitical Instability and Security Risks: The MEA region is frequently affected by geopolitical tensions, civil conflicts, and terrorism risks that pose direct threats to oil refining infrastructure. Countries such as Libya, Syria, Yemen, and parts of Nigeria have experienced refinery shutdowns or reduced capacity due to sabotage, warfare, or political upheaval. These unstable environments deter foreign investment, delay project timelines, and increase operational risk and insurance costs for existing and planned facilities, hindering the region’s overall refining potential.
• Limited Refining Infrastructure in Sub-Saharan Africa: While the Middle East boasts advanced refining facilities, much of Sub-Saharan Africa still struggles with inadequate refining infrastructure. Many African nations rely heavily on imported refined fuels despite being oil producers themselves. Aging refineries, insufficient capacity, and lack of technical expertise have contributed to chronic fuel shortages and high prices. Governments are attempting to modernize and build new facilities (e.g., Nigeria’s Dangote Refinery), but challenges such as financing gaps, corruption, and policy inconsistency often slow progress.

Market Trends

• Expansion of Integrated Refining and Petrochemical Complexes: A key trend in the MEA refining sector is the development of integrated complexes that combine refining with petrochemical production. This model enables greater value extraction from crude oil by producing higher-margin petrochemical products like plastics and fertilizers alongside traditional fuels. Projects such as the Ruwais expansion (UAE), Ras Tanura upgrade (Saudi Arabia), and Egypt’s refining-petrochemical hubs are examples of this shift. These complexes enhance profitability and reduce dependence on fluctuating fuel markets.
• Growing Focus on Cleaner Fuels and Environmental Compliance: Despite traditionally being less regulated, MEA countries are beginning to adopt stricter fuel quality standards and environmental policies in response to global pressure and domestic air pollution concerns. Countries like Saudi Arabia, Egypt, and South Africa are phasing out high-sulfur fuels and upgrading refineries to meet Euro V or equivalent standards. Additionally, investments in sulfur recovery units and carbon capture technologies are increasing. These efforts reflect a growing trend toward sustainability and alignment with international environmental expectations.

The growth of jet fuel in the Middle East and Africa (MEA) oil refining industry is primarily driven by the rapid expansion of the aviation sector, supported by increased air travel demand, tourism, and strategic investments in airline fleets and airport infrastructure.

The rising demand for jet fuel in the Middle East and Africa (MEA) oil refining industry is closely linked to the region’s booming aviation sector, which is undergoing a period of significant growth due to a confluence of economic, demographic, and strategic factors. Several countries in the region - particularly the Gulf Cooperation Council (GCC) states such as the UAE, Qatar, and Saudi Arabia have positioned themselves as global aviation hubs by heavily investing in modern airports, expanding national carriers, and increasing international flight connectivity. Airlines like Emirates, Qatar Airways, and Etihad have become major global players, fueling the need for refined jet fuel to support their growing fleets. Moreover, the MEA region is experiencing a steady rise in passenger traffic due to both business and leisure travel. Initiatives such as Saudi Arabia’s Vision 2030 aim to diversify the economy and boost tourism, leading to increased air travel and consequently higher jet fuel consumption. African nations like Ethiopia, Kenya, and South Africa are also developing aviation infrastructure and expanding flight routes to meet growing intra-regional and international travel demand. In parallel, the MEA region is witnessing population growth and rising middle-class incomes, which are contributing to greater affordability and frequency of air travel among residents. Additionally, several international airlines are increasing stopovers and flight routes through MEA, taking advantage of the region’s strategic geographic location as a bridge between Europe, Asia, and Africa. This has led to a surge in jet fuel bunkering and storage needs.

The moderate growth of the residential and commercial application segment in the MEA oil refining industry is driven by rising urbanization, population growth, and increasing demand for heating, cooking, and backup power in areas with limited access to reliable electricity.

The residential and commercial application segment is witnessing moderate growth in the Middle East and Africa (MEA) oil refining industry due to a combination of demographic trends and infrastructure-related energy needs. One of the key drivers is the region’s fast-paced urbanization and population growth, particularly in developing countries across Sub-Saharan Africa and parts of the Middle East. As more people migrate to urban centers and new residential zones are developed, the demand for refined oil products such as liquefied petroleum gas (LPG), kerosene, and diesel for everyday household and commercial use especially for heating, cooking, and small-scale power generation continues to rise. Many areas within the MEA region, especially in rural Africa and underserved urban peripheries, still lack reliable electricity access. In these contexts, diesel generators and kerosene lamps remain vital energy sources for residential and commercial activities, making refined oil products essential to daily life. Additionally, in countries facing unstable power grids or frequent outages, such as Nigeria, South Africa, and parts of East Africa, there is growing reliance on oil-based fuels for standby and off-grid energy solutions in homes, shops, small businesses, and community services. Furthermore, LPG is increasingly promoted by governments and NGOs as a cleaner and safer alternative to biomass fuels like wood and charcoal, which are still widely used for cooking in many low-income households. This transition is gradually increasing demand for LPG, especially in urban and peri-urban areas. In wealthier Gulf nations, while natural gas and electricity dominate, there is still consistent use of refined oil products in specific commercial applications, particularly in hospitality, retail, and construction sites.

The moderate growth of biomass feedstock in the MEA oil refining industry is driven by increasing interest in sustainable energy alternatives and biofuel development, supported by government initiatives and international partnerships aimed at reducing carbon emissions and enhancing energy security.

The use of biomass as a feedstock in the Middle East and Africa (MEA) oil refining industry is experiencing moderate growth as the region gradually embraces sustainable energy solutions in response to global environmental concerns and local energy diversification goals. While fossil fuels still dominate the region’s energy mix, there is a growing awareness among governments, industry players, and international partners about the need to reduce carbon emissions and transition to greener alternatives. Biomass feedstock, derived from agricultural residues, forestry waste, municipal organic waste, and energy crops, offers a renewable and relatively low-carbon alternative that can be converted into biofuels, including biodiesel and bioethanol. In Africa, the abundance of agricultural biomass such as sugarcane bagasse, maize stalks, and palm residues presents a significant opportunity for biofuel production. Countries like South Africa, Kenya, Nigeria, and Ghana have started to implement policies that support biofuel blending and investment in bio-refineries, thereby boosting the demand for biomass as a refining input. Similarly, North African nations like Egypt and Morocco are exploring biomass-based energy as part of broader energy security and rural development strategies. In the Middle East, although biomass availability is more limited due to arid conditions, some Gulf countries are investing in waste-to-energy and algae-based biomass technologies as part of their green economy visions. Saudi Arabia and the UAE, for example, are launching pilot projects to convert organic waste into fuel, aligning with long-term sustainability goals. International support from climate funds, development agencies, and private sector investors is also helping to advance biomass infrastructure and research in the region.

The moderate growth of hydro-skimming complexity type in the MEA oil refining industry is driven by the need for cost-effective, simpler refining solutions to meet local fuel demand in emerging economies without the heavy investment required for deep conversion facilities.

Hydro-skimming refineries are experiencing moderate growth in the Middle East and Africa (MEA) oil refining industry as countries across the region seek to balance the need for domestic fuel production with limited capital resources and simpler operational requirements. Hydro-skimming refineries, which include basic atmospheric distillation units along with naphtha reforming and modest desulfurization capabilities, offer a cost-effective and relatively quick-to-deploy solution for producing essential petroleum products such as gasoline, diesel, kerosene, and fuel oil. In many parts of Sub-Saharan Africa and North Africa, where full-scale deep conversion refineries are not economically feasible or necessary due to modest fuel demand and constrained infrastructure, hydro-skimming plants are being considered or developed to reduce reliance on imported refined fuels. Countries like Nigeria, Angola, Sudan, and Tanzania are exploring or upgrading hydro-skimming capacities to ensure local fuel availability and enhance energy self-sufficiency. These facilities also play a key role in regional economic development by supporting job creation and reducing the foreign exchange burden associated with fuel imports. In the Middle East, although the region is home to several world-class complex refineries, hydro-skimming operations still serve niche markets, especially for meeting localized or short-term demand, or as part of strategic reserve or backup production capacity. In landlocked or remote areas, the simplicity and lower investment cost of hydro-skimming units make them an attractive option for decentralized refining.

Saudi Arabia leads the Middle East and Africa oil refining industry primarily due to its vast crude oil reserves, strategic government investment in downstream infrastructure, and its vision to diversify the economy by expanding refining and petrochemical capacities.

Saudi Arabia’s dominance in the Middle East and Africa oil refining industry is firmly rooted in its unparalleled access to abundant crude oil reserves and its strategic ambition to shift from being merely a crude oil exporter to a global leader in refined petroleum and petrochemical products. As the largest oil producer in the region and one of the top globally, Saudi Arabia enjoys a secure and cost-effective crude supply, which forms the backbone of its extensive and modern refining operations. Over the past two decades, the Kingdom has invested heavily in expanding and upgrading its refining capacity as part of its broader economic diversification strategy, Vision 2030. This initiative aims to reduce dependence on crude oil exports by fostering value-added industries, including refining and petrochemicals. Major projects such as the Jazan Refinery, a state-of-the-art integrated facility on the Red Sea, and the Rabigh Refining and Petrochemical Complex a joint venture between Saudi Aramco and Sumitomo Chemical reflect the country’s focus on producing high-quality fuels and chemical feedstocks for domestic use and export. Saudi Aramco, the national oil giant, plays a central role in this expansion by not only building world-class refineries but also integrating them with petrochemical plants to maximize value across the supply chain. Its refining operations are among the most efficient and technologically advanced in the world, with a strong emphasis on environmental standards and energy efficiency. The Kingdom’s strategic geographic location also enhances its leadership in the sector, providing direct access to both Asian and European markets via the Red Sea and Arabian Gulf. This enables seamless export of refined products, including diesel, gasoline, and jet fuel, to energy-hungry economies in the East and West.

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