Economy

Brent Trades Closer to $44 on Possible Tighter Supply

Published

6 years ago

18/11/2020

By Adedapo Adesanya

Prices of crude oil further increased at the market on Tuesday as a result of the renewed confidence investors have that the deadly COVID-19 could soon be defeated due to the outcome of the vaccine trials.

This boosted the market coupled with the possibility of tighter supply policies from oil producers aimed to suppress the threats posed by the rising coronavirus cases in Europe and America.

During trading yesterday, the Brent crude moved up by 0.07 per cent or 3 cents to sell at $43.85 per barrel, while the West Texas Intermediate (WTI) crude appreciated by 0.22 per cent or 10 cents to trade $41.43 per barrel.

On Monday, the oil space got a boost when Moderna Inc’s announced that its coronavirus vaccine was 94.5 per cent effective. The information came some days after Pfizer Inc also said its vaccine was over 90 per cent effective.

However, developments from the United States over the average number of people dying of COVID-19 daily threatened the market just like the fresh movement restrictions in Europe.

But the market remains hopeful as Saudi Arabia called on fellow members of the Organisation of the Petroleum Exporting Countries and its allies (OPEC+) to be flexible in responding to oil market needs as it builds the case for a tighter production policy in 2021.

It was reported that the oil cartel is considering four possible scenarios for 2021. Two of these are based on following the initial arrangements, including a further relaxation of cuts from 7.7 million barrels per day to 5.8 million barrels per day from January.

Under these two scenarios, the drawdown in global oil stockpiles will continue, but the total will remain well above the five-year average.

In the milder pandemic effect scenario, oil inventories will be 125 million barrels higher in 2021 than the five-year average, and in the more severe pandemic effect scenario, these will be 470 million higher than the five-year average. This will translate into an excess supply of 1.9 million barrels per day.

An option gaining support among OPEC+ nations is to keep the existing cuts of 7.7 million barrels per day (bpd) for a further three to six months rather than tapering in January.

But looking at tougher production restrictions scenarios, the drawdown will be more significant: if the deal is extended by three months, until the end of March, global inventories will only end up being 73 million barrels higher than the five-year average by the end of 2021.

However, if the cuts are extended until the end of June, the total supply will be just 21 million barrels, higher than the five-year average. These figures translate into a daily supply deficit of between 900,000 barrels per day and 1.4 million barrels per day, according to analysts.

OPEC+ held a ministerial committee meeting on Tuesday that made no formal recommendation. The group will hold a full meeting on November 30 – December 1.

The market will await official figures from the Energy Information Administration (EIA) in the United States on Wednesday as analysts said crude inventories likely rose 1.7 million barrels last week after gaining 4.3 million barrels in the prior week.

Economy

Dangote Values Refinery at $39bn, Seeks $1bn in Private Placement

Published

14 hours ago

11/06/2026

Adedapo Adesanya

By Adedapo Adesanya

Dangote Petroleum Refinery is seeking to raise about $1 billion through a private placement that values the company at $39.1 billion.

According to reports, the refinery is offering 3 billion ordinary shares at $0.35 per share. Investors must subscribe for at least 1 million shares, equal to $350,000, with additional subscriptions accepted in multiples of 500,000 shares. The shares will be subject to a 365-day lock-up period from allotment.

It was reported that demand for the offer has already exceeded $2 billion, suggesting that the placement may be oversubscribed.

The operation is already attracting the interest of local investors. Recall that Nigerian billionaire, Mr Femi Otedola, has committed $100 million, while Afrobeats superstar, Mr David Adeleke, popularly known as Davido, also announced he would participate.

The proceeds will be used for expansion projects and general corporate purposes as the refinery deepens its role in Nigeria’s fuel supply market.

The facility has a nameplate capacity of 650,000 barrels per day and began fuel production in 2024. It produces diesel, aviation fuel, naphtha and premium motor spirit.

Standard Bank Group has also said it plans to play a leading role in the refinery’s future public listing, after the facility completed test runs at 700,000 barrels per day. It aims to reach 1.4 million barrels per day by 2028.

The fundraising is likely to renew expectations of a future public listing with a major stakeholder, Mr Aliko Dangote, saying the refinery could be listed, though no timeline was disclosed in the memorandum.

The current placement is seen as an early step that could expand ownership ahead of any future initial public offering (IPO).

Mr Dangote plans to sell between 5 and 10 per cent of the refinery on five major African exchanges: the Nigerian Exchange (NGX), the Johannesburg Stock Exchange (JSE), the BRVM, the Nairobi Securities Exchange (NSE) and the Ghana Stock Exchange (GSE).

It has appointed Stanbic IBTC Capital, Vetiva Capital Management and FirstCap to lead the planned initial public offering of its refinery business on the Nigerian Exchange.

Economy

Investors Lose N3.1bn as NASD Exchange Remains Red

Published

18 hours ago

11/06/2026

Adedapo Adesanya

By Adedapo Adesanya

The NASD Over-the-Counter (OTC) Securities Exchange entered a third straight day of losses after it fell by 0.12 per cent on Wednesday, June 10.

The depletion trimmed the market capitalisation further by N3.1 billion to N2.590 trillion from N2.593 trillion, and cut the NASD Unlisted Security Index (NSI) by 5.19 points to 4330.12 points from 4,335.31 points.

11 Plc lost N22.21 during the session to finish at N221.00 per share versus the previous day’s N243.21 per share, MRS Oil Plc depreciated by N6.90 to N158.10 per unit from N165.00 per unit, and Central Securities Clearing System (CSCS) Plc decreased by N2.81 to N78.32 per share from N81.13 per share.

On the flip side, FrieslandCampina Wamco Nigeria Plc went up by N9.27 to N183.08 per unit from N173.81 per unit, Nitrox Industrial Gases Plc added N1.92 to its value to close at N23.80 per share compared with the preceding day’s N21.88 per share, and Food Concepts Plc gained 10 Kobo to exchange at N2.58 per unit, in contrast to Tuesday’s closing price of N2.48 per unit.

At the close of business, the volume of securities traded by investors contracted by 92.6 per cent to 117,374 units from 1.6 million units, and the value of securities moderated by 80.5 per cent to N12.2 million from N62.3 million, while the number of deals increased by 4.9 per cent to 43 deals from 41 deals.

Great Nigeria Insurance (GNI) Plc finished the day as the most traded stock by value on a year-to-date basis with 3.4 billion units worth N8.4 billion, followed by Infrastructure Credit Guarantee (Infracredit) Plc with 2.3 billion units traded for N6.5 billion, and CSCS Plc with 65.2 million units exchanged for N4.4 billion.

GNI Plc also closed the session as the most traded stock by volume on a year-to-date basis with 3.4 billion units valued at N8.4 billion, followed by Infracredit Plc with 2.3 billion units transacted for N6.5 billion, and Resourcery Plc with 1.1 billion units sold for N415.7 million

Economy

Naira Crashes to N1,362.05/$1 at Official Window After N1.50 Loss

Published

19 hours ago

11/06/2026

Adedapo Adesanya

By Adedapo Adesanya

The Naira fell against the United States Dollar by N1.50 or 0.11 per cent in the Nigerian Autonomous Foreign Exchange Market (NAFEX) to sell at N1,362.05/$1 on Wednesday, June 10, compared with the N1,360.55/$1 it traded on Tuesday.

Also, the local currency lost N4.33 against the Pound Sterling in the official window yesterday to trade at N1,827.33/£1 versus the preceding day’s N1,823.00/£1, and depreciated against the Euro by N1.74 to quote at N1,575.35/€1, in contrast to N1,573.61/€1 of the previous session.

However, at the GTBank forex desk, the Naira gained N3 against the US Dollar to sell at N1,370/$1 versus N1,373/$1, and at the parallel market, it remained unchanged at N1,380/$1.

Updated data from the Central Bank of Nigeria (CBN) showed that foreign reserves surged further due to additional inflows from various sources. Nigeria’s gross external reserves increased to $50.439 billion, its highest level since March 2026, reflecting sustained inflows from oil revenue and other FX sources.

Also, the International Monetary Fund (IMF) has said increased confidence in the Naira, supported by lower and more stable inflation, would encourage households, businesses and investors to hold more local currency assets and reduce reliance on foreign currencies.

The global lender, in a recent assessment, stressed the importance of strengthening the CBN’s operational framework and aligning liquidity management operations more closely with monetary policy objectives.

In the cryptocurrency market, there were recoveries from recent losses as US headline inflation rose an expected 0.5 per cent in May, but the beat on the core rate — which cuts out food and energy costs — pleased markets. The core rate, though, rose just 0.2 per cent in May against forecasts for 0.3 per cent.

The print reinforces the view that the US Federal Reserve will keep interest rates at 350-375 basis points at its June 17 meeting, but is likely to increase rates by 25 basis points by the end of the year.

Cardano (ADA) went up by 2.4 per cent to $0.1647, Bitcoin (BTC) rose by 2.3 per cent to $62,794.09, Binance Coin (BNB) jumped 1.8 per cent to $596.23, Ethereum (ETH) grew by 1.7 per cent to $1,658.12, and Solana (SOL) also soared by 1.7 per cent to $65.23.

Further, Dogecoin (DOGE) appreciated by 1.5 per cent to $0.0849, Ripple (XRP) expanded by 0.4 per cent to $1.11, and TRON (TRX) increased by 0.05 per cent to $0.3218, while the US Dollar Tether (USDT) lost 0.10 per cent to close at $0.9989, and the US Dollar Coin (USDC) declined by 0.01 per cent to $0.9997.