Economy

Nigeria’s Bonny Light Crude Rises as Brent Falls

Published

4 years ago

06/05/2021

By Adedapo Adesanya

Crude oil prices moved in different directions at the global oil market on Wednesday as crude stockpiles in the United States declined, exceeding expectations.

Business Post reports that the Brent crude futures lost 17 cents or 0.25 per cent to trade at $68.71 per barrel, the West Texas Intermediate (WTI) crude futures depreciated by 6 cents or 0.09 per cent to sell for $65.63 per barrel, while Nigeria’s Bonny Light crude appreciated by 87 cents or 1.29 per cent to trade at $67.18 per barrel.

Further, the OPEC Basket was up by $1.58 or 2.43 per cent to $66.67 per barrel, while the Brass River and Qua Iboe, two of Nigeria’s oil grades, improved by $1.66 or 2.56 per cent each to $66.59 per barrel apiece.

Prices of crude oil had earlier rose after the Energy Information Administration (EIA) reported an inventory draw of 8 million barrels for the week to April 30 but later gave up the gains to trade lower.

The oil inventory figure compares with a weekly draw of 7.688 million barrels estimated by the American Petroleum Institute (EIA) a day earlier, and with a moderate build of 100,000 barrels that the EIA reported for the previous week.

Analysts had expected the EIA to report a crude oil inventory decline of 2.19 million barrels for the period.

However, despite the impressive signals, the market is still reeling from the increased rate of coronavirus in some other parts of the world with infections still on the rise in India and Japan, two of the world’s largest oil exporters and consumers.

In India, COVID-19 related deaths rose by a record of 3,780 in the last 24 hours while daily infections rose by 382,315 on Wednesday, indicating that the South Asian country’s morbidity number has been in excess of 300,000 every day for the past two weeks.

Medical experts dispute published figures saying India’s actual figures could be five to 10 times the official details as the country has added 10 million cases in just over four months, after taking more than 10 months to reach its first 10 million, a worrying sign for the black gold.

On Japan’s end, the country’s government is considering an extension of the state of emergency for Tokyo and other major urban areas that were scheduled to end on May 11. It had placed Tokyo, Osaka, Kyoto and Hyogo prefectures under a 17-day state of emergency on April 25 in an effort to reverse the surge in coronavirus infections.

Meanwhile, vaccination efforts in other parts of the world keep indicating that demand is on its pathway to recovery. In the US, more than 40 per cent of adults have received at least one shot and more than half of adults in the United Kingdom. Also, in the US, states have begun to relax movement restrictions as the rates of vaccinated people continue to rise.

In addition, the European Union is set to start allowing foreign tourists into the bloc beginning from June in an attempt to avoid a second ruined summer tourist season, which will help boost demand.

Economy

Nigeria Led Africa’s Upstream Oil, Gas Investments in 2024

Published

13 hours ago

21/01/2025

Adedapo Adesanya

By Adedapo Adesanya

Nigeria ranked as Africa’s leading destination for upstream oil and gas investment in 2024, new research from market intelligence firm, Wood Mackenzie, has shown, accounting for three out of four Final Investment Decisions (FIDs) announced by global oil and gas majors, totaling $13.5 billion.

The FIDs announced within the Nigerian market included Shell’s $122 million investment in the Iseni Gas Project, TotalEnergies’ $566 million commitment to the Ubeta Gas Project and Shell’s approval of the Bonga North Tranche 1 project valued at around $5 billion.

According to the Special Adviser to President Bola Tinubu on Energy, Ms Olu Verheijen, these investments reflected Nigeria’s ongoing efforts to unlock its hydrocarbon potential through investor-friendly policies and strategic global partnerships.

Last year, Nigeria introduced several initiatives to create a conducive environment for oil and gas investors, including new tax incentives aimed at attracting up to $10 billion in natural gas investments.

Nigeria, which is Africa’s largest oil producer, also offered tax relief for gas investors, reducing corporate income tax and extending capital allowance benefits – for deepwater gas projects.

Other policies include the Presidential Directive on Local Content Compliance Requirements 2024 to address the reduction in oil and gas investments caused by high operating costs compared to global markets.

Also, the Presidential Directive on Reduction of Petroleum Sector Contracting Costs and Timelines 2024 reduces the time spent to award contracts for oil and gas projects.

In addition to the directives, Nigeria also launched its 2024 oil and gas licensing round, offering 19 blocks for exploration, demonstrating its commitment to continued collaboration with local, regional and international partners.

Market analysts note that with this momentum, further FIDs are anticipated, including TotalEnergies’ expected $750 million commitment to the Ima Shallow Gas Project in 2025.

Economy

UBN Property Triggers 0.22% Loss at NASD OTC Exchange

Published

17 hours ago

21/01/2025

Adedapo Adesanya

By Adedapo Adesanya

The NASD Over-the-Counter (OTC) Securities Exchange recorded a 0.22 per cent decline on Monday, January 20, with the market capitalisation shedding N2.35 billion to close at N1.073 trillion compared with the preceding session’s N1.075 trillion and the NASD Unlisted Security Index (NSI) going down by 6.79 points to wrap the session at 3,105.12 points compared with 3,111.91 points recorded in the previous session.

It was observed that the loss recorded on the first trading day of the week was triggered by UBN Property Plc, which crashed by 20 Kobo to trade at N2.00 per share versus last Friday’s N2.20 per share.

However, the share price of Industrial and General Insurance (IGI) Plc went up by 4 Kobo to 40 Kobo per unit from 36 Kobo per unit, it could not stop the bourse from going down at the close of transactions.

The activity chart showed that on Monday, the volume of securities traded by investors increased by 57.9 per cent to 767,610 units from the 486,215 units traded in the preceding session, while the value of shares traded yesterday slumped by 17.7 per cent to N2.3 million from the N2.8 million recorded in the preceding trading day, as the number of deals declined by 14.3 per cent to 12 deals from the 14 deals carried out in the previous trading day.

At the close of transactions, FrieslandCampina Wamco Nigeria Plc remained the most active stock by value on a year-to-date basis with the sale of 4.1 million units worth N162.9 million, followed by Geo-Fluids Plc with a turnover of 9.1 million units valued at N44.0 million, and 11 Plc with the sale of 55,358 for N14.5 million.

Also, Industrial and General Insurance (IGI) Plc closed the day as the most active stock by volume on a year-to-date basis with 25.3 million units sold for N5.9 million, Geo-Fluids Plc came next with 9.1 million units valued at N44.0 million, and FrieslandCampina Wamco Nigeria Plc with 4.1 million units worth N162.9 million.

Economy

Naira Weakens to N1,550/$1 at Official Market, Gains N5 at Black Market

Published

17 hours ago

21/01/2025

Adedapo Adesanya

By Adedapo Adesanya

The value of the Naira weakened against the US Dollar at the Nigerian Autonomous Foreign Exchange Market (NAFEM) on Monday, January 20 amid FX pressures associated with this period.

Most people who came into the country for Christmas and New Year holidays are already going back and are in need of forex, putting pressure on the local currency.

Also, the poor performance of the domestic currency could be attributed to end to the 42-day access granted by the Central Bank of Nigeria (CBN) to Bureaux de Change (BDC) operators to buy forex at official price.

According to data from the FMDQ Securities Exchange, the Nigerian Naira lost 0.16 per cent or N2.47 on the greeback yesterday to sell at N1,550.05/$1, in contrast to last Friday’s rate of N1,547.58/$1.

Similarly, the Naira slumped against the Pound Sterling in the spot market on Monday by N23.39 to trade at N1,906.98/£1 versus N1,883.59/£1 and depreciated against the Euro by N23.14 to sell for N1,613.48/€1 compared with last Friday’s N1,590.34/€1.

However, in the parallel market, the Nigerian currency improved its value against the Dollar during the session by N5 to quote at N1,665/$1 compared with the previous session’s N1,670/$1.

As for the cryptocurrency market, it turned red yesterday as the US President, Mr Donald Trump, didn’t bring up the much-expected subject of crypto in his inauguration speech on Monday afternoon.

Mr Trump had promised a far more friendly crypto policy stance than the previous administration but in the long speech that announced his plans in the coming days, he didn’t make mention of Bitcoin or crypto.

Just over the weekend, the President ignited a speculative frenzy with the Friday evening launch of the Trump meme coin, which was shortly followed by a meme coin associated with his wife, Melania.

Dogecoin (DOGE) crumbled yesterday by 6.3 per cent to $0.3419, Solana (SOL) slumped by 4.7 per cent to $235.32, Cardano (ADA) fell by 3.6 per cent to $0.9777, and Litecoin (LTC) moderated by 1.9 per cent to $114.98.

Further, Ethereum (ETH) went down by 1.7 per cent to $3,241.36, Binance Coin (BNB) retreated by 1.4 per cent to $693.30, Ripple (XRP) depreciated by 1.2 per cent to $3.06, and Bitcoin (BTC) tumbled by 0.8 per cent to $101,746.99, while the US Dollar Tether (USDT) and the US Dollar Coin (USDC) remained unchanged at $1.00 each.