Economy

Crude Oil Trades at Nigeria’s 2020 Budget Benchmark, $57/Barrel

Published

5 years ago

19/02/2020

By Adedapo Adesanya

The Brent crude futures continued to trade around the $57 mark on Tuesday, giving Nigeria a hope of being able to get something from oil revenue to fund its 2020 budget as envisaged.

The price of the commodity had been facing south lately, no thanks to the deadly coronavirus, nicknamed CONVID-19 by the World Health Organisation (WHO), which originated from China, causing low demand for oil.

The bearish performance of the Brent Crude this year had seen it drop by more than $10. However, since last week, the commodity started a recovery that has brought it up to its present level.

On Tuesday night, the international crude benchmark, on which Nigeria’s oil is priced, rose by 0.06 percent equivalent to 3 cents to trade at $57.65 per barrel, while the US West Texas Intermediate (WTI) crude also moved up marginally by 0.03 percent or 2 cents to trade at $52.02 per barrel.

When the federal government prepared the 2020 budget last year, it was estimated that oil prices would average in the year at $57 per barrel on the hopes that the US-China trade deal agreement would push demand higher, causing rise in the price. Though at the beginning of this year, oil was rising, mainly due to an escalation of the US/Iran enmity. However, the coronavirus brought pains to oil.

The outbreak put pressure on Nigeria’s plan to raise N2.64 trillion in revenue from crude oil sales from output of two million barrels a day.

But the 2 million production estimate may be under threat as the Organisation of the Petroleum Exporting Countries (OPEC), which Nigeria belongs to, is planning to further ask its members to reduce what they produce so as to support prices.

Last year, Nigeria, which has previously been exempted from output cut due to unrest in the Niger Delta that affected its supply, agreed to a 57,000 barrels per day cut in order to support prices.

In January 2020, Nigeria pumped 1.776 million barrels of oil per day (bpd), according to OPEC’s secondary sources in its monthly report, and with already unsteady revenue, a further cut will mean less production.

There has been delay in implementing the latest proposal, which may have Nigeria further cut its production by another 57,000 barrels per day or less. Russia, a member of OPEC+, is yet to agree to the further 600,000 bpd being recommended by the group.

Oil ministers of OPEC and non-OPEC countries, known as OPEC+, will next meet in Vienna on March 6 as initially planned, it was revealed on Tuesday.

Mr Pavel Sorokin, Russian deputy energy minister, said the country’s energy ministry still expected the meeting to take place on March 6, as announced by OPEC in December.

He also stated that the country will make its stance on the cut know in a few days and market investors will be waiting because any possible positive outcome will help prices up, by extension – a good news for Nigeria.

Economy

NASD Index Records 0.67% Appreciation

Published

2 hours ago

29/11/2024

Adedapo Adesanya

By Adedapo Adesanya

The NASD Over-the-Counter (OTC) recorded a 0.67 per cent appreciation on Thursday, November 28, with the portfolios of investors on the platform rising by N7.09 billion to N1.061 trillion from the N1.053 trillion it closed in the preceding session and the NASD Unlisted Security Index (NSI) growing by 20.22 points to wrap the session at 3,026.60 points compared with 3,006.38 points recorded on Wednesday.

This happened after the unlisted securities market finished the trading session with three price gainers and two price losers.

Afriland Properties Plc gained N1.58 to end at N17.39 per unit compared with the midweek’s closing price of N15.81 per unit, as Acorn Petroleum Plc improved its value by 14 Kobo to close at N1.69 per share, in contrast to the previous day’s N1.55 per share, and Central Securities Clearing System (CSCS) Plc went up by N1 to sell for N23.00 per unit compared with the preceding session’s N22.00 per unit.

On the flip side, First Trust Microfinance Bank Plc lost 4 Kobo to finish at 32 Kobo per share versus Wednesday’s closing price of 36 Kobo per share and Geo-Fluids Plc slumped by 3 Kobo to sell at N3.90 per unit compared to N3.93 per unit it was sold a day earlier.

There was a 191.9 per cent rise in the volume of securities traded in the session as investors exchanged 2.9 million units compared with the previous trading day’s 1.0 million units.

Equally, there was a 283.9 per cent surge in the value of shares traded yesterday to N7.9 million from the N2.1 million recorded in the previous day, and the number of deals increased by 300 per cent to 12 deals from the three deals executed in the preceding day.

At the close of transactions, Geo-Fluids Plc was the most active stock by volume (year-to-date) with 1.7 billion units valued at N3.9 billion, trailed by Okitipupa Plc with 752.2 million units sold for N7.8 billion, and Afriland Properties Plc with 297.3 million units worth N5.3 million.

Aradel Holdings Plc remained the most active stock by value (year-to-date) with 108.7 million units worth N89.2 billion, followed by Okitipupa Plc with 752.2 million units valued at N7.8 billion, and Afriland Properties Plc with 297.3 million units sold for N5.3 billion.

Economy

Enhanced Forex Liquidity Buoys Naira to N1,644/$1 at Official Market

Published

2 hours ago

29/11/2024

Adedapo Adesanya

By Adedapo Adesanya

The value of the Naira rose against the US Dollar at the Nigerian Autonomous Foreign Exchange Market (NAFEM) by 0.96 per cent or N15.97 to exchange at N1,644.86/$1 on Thursday, November 28 compared with the preceding day’s N1,660.83/$1 amid a surge in FX transactions.

Data showed that the forex turnover increased during the session by 66.2 per cent or $223.27 million to $560.34 million from the $337.07 million recorded at the midweek trading session.

However, the domestic currency weakened against the Pound Sterling in the official market by N8.42 to sell at N2,124.86/£1 compared with the preceding session’s N2,116.44/£1 but appreciated against the Euro by N10.18 to quote at N1,773.18/€1 versus midweek’s closing rate of N1,783.36/€1.

A look at the parallel market showed that the Nigerian currency traded flat against its American counterpart yesterday at N1,750/$1.

Meanwhile, cryptocurrencies were largely positive as Ripple (XRP) rose by nearly 6 per cent, precisely by 5.9 per cent to trade at $1.56to as Thanksgiving holiday saw the market avoid a feared historical massacre.

Traders said the Japanese Yen briefly crossed 150 against the Dollar due to expectations of a Bank of Japan (BOJ) rate increase in December, spurred by higher-than-expected inflation data.

The movement was also likely spurred by month-end financial adjustments and low liquidity due to Thanksgiving.

Further, Cardano (ADA) went up by 3.4 per cent to trade at $1.04, Solana (SOL) jumped by 1.1 per cent to quote at $241.14, Bitcoin (BTC) went up by 0.8 per cent to settle at $95,661.36 and Binance Coin (BNB) grew by 0.2 per cent to finish at $654.44.

On the flip side, profit-taking in Dogecoin (DOGE) saw its price down by 0.5 per cent to sell at $0.4054, Litecoin (LTC) depreciated by 0.5 per cent to quote at $96.36, and Ethereum (ETH) depleted by 0.4 per cent to end the session at $3,578.26, while the US Dollar Tether (USDT) and the US Dollar Coin (USDC) remained unchanged at $1.00 each.

Economy

Nigeria’s Stock Market Rebounds by 0.50%

Published

3 hours ago

29/11/2024

Dipo Olowookere

By Dipo Olowookere

The Nigerian Exchange (NGX) Limited rebounded by 0.50 per cent on Thursday after staying with the bears for a single trading session, though investor sentiment remained weak.

Business Post reports that the market breadth index was negative yesterday with 28 appreciating stocks and 29 depreciating stocks.

Vitafoam Nigeria was the best-performing equity during the trading day after it went up by 9.81 per cent to sell for N23.50, Aradel Holdings appreciated by 9.23 per cent to N517.00, FTN Cocoa rose by 7.82 per cent to N1.93, Sovereign Trust Insurance grew by 6.25 per cent to 68 Kobo, and Oando gained 5.40 per cent to quote at N65.35.

On the flip side, Prestige Assurance ended the day as the worst-performing equity after it shed 10.00 per cent to close at 81 Kobo, Unilever Nigeria lost 9.97 per cent to settle at N26.65, Austin Laz depleted by 9.96 per cent to N2.17, John Holt waned by 9.90 per cent to N8.92, and Eterna fell by 6.94 per cent to N20.80.

During the session, the energy and the consumer goods sectors went down by 0.50 per cent and 0.11 per cent, respectively.

However, the banking index improved by 0.74 per cent, the insurance counter expanded by 0.23 per cent, and the industrial goods space increased by 0.15 per cent.

As a result, the All-Share Index (ASI) jumped by 487.24 points to 97,783.81 points from the 97,296.57 points recorded in the preceding day and the market capitalisation grew by N305 billion to settle at N59.275 trillion compared with Wednesday’s closing value of N58.970 trillion.

Yesterday, the value of transactions expanded by 4.85 per cent to N10.8 billion from the N10.3 billion recorded a day earlier, as the volume of trades shrank by 23.08 per cent to 632.7 million shares from the 822.5 million shares traded at midweek and the number of deals tumbled by 10.45 per cent to 8,404 deals from the 9,385 deals achieved in the previous day.

FBN Holdings was the busiest stock at the market on Thursday with a turnover of 166.8 million units worth N4.2 billion, Haldane McCall traded 119.3 million units valued at N669.8 million, Guinea Insurance transacted 41.3 million units for N20.7 million, Cutix sold 38.5 million units worth N90.5 million, and Access Holdings exchanged 20.6 million units valued at N473.6 million.