W. Africa historically major market for European petrol
Gasoline flows redirected after fuel subsidy scrapped
Some Mideast, Russian flows move to WAF, but still small

LONDON, July 28 Reuters One of Europe39;s main markets for gasoline has shrunk, threatening to squeeze European refiners, after Nigeria removed fuel subsidies, which destroyed much of the country39;s domestic demand and a regional market for smuggled fuel.

North America and West Africa WAF, with Nigeria at the helm, historically have been the top two destinations for petrol exports from Europe, which produces more gasoline than it uses, meaning its refiners rely on exports to support profit margins.

A steady decline in European refining margins in recent years, as competition from the Middle East, the United States and Asia grew, was reversed when fears of fuel supply shortages boosted profits after Russia39;s invasion of Ukraine.

So far, benchmark profit margins for gasoline in northwestern Europe have held firm at around 27 a barrel, Refinitiv Eikon data shows.

They have been supported by demand from North America, a shortage of high quality blending materials, disruption caused by low water levels inland and local refinery outages.

But analysts say the reduction of flows following the upheaval in Nigeria will increase pressure on European refiners, and any winners are likely to be newer Middle Eastern refineries.

At the end of May, Nigeria39;s President Bola Tinubu scrapped a popular but…