Disclosed are sp2 carbon nanogranules with iron incorporated from heavy petroleum residue of a refinery. The nanogranules may be used for improved synthesis of light olefins (C2-C4) from syngas in a single step Fischer Tropsch synthesis to lower olefins, (FTO). The efficient iron incorporated carbon nanogranules derived from low value heavy petroleum residue are very attractive as a catalytic system for direct synthesis of light olefin (C2-C4) from syngas at CO conversion up to 30%.