Economy
Oil Jumps as Supplies Shrink in Canada, OPEC+
By Adedapo Adesanya
Oil edged up 1 per cent on Monday as forecasts for oil showed that demand would rise in the second half of the year, while supplies from Canada and the Organisation of the Petroleum Exporting Countries and its allies (OPEC+) declined in recent weeks.
Brent futures rose by 41 cents or 0.5 per cent to $75.99 a barrel, while the US West Texas Intermediate (WTI) futures appreciated by 44 cents or 0.6 per cent to $71.99 per barrel.
The International Energy Agency (IEA), meanwhile, warned of a looming oil shortage in the second half of the year when demand is expected to eclipse supply by almost 2 million barrels per day.
The Paris-based agency raised its forecast for global oil demand by 200,000 barrels per day to 102 million barrels per day, noting that China’s recovery after the lifting of COVID-19 curbs had surpassed expectations, with demand reaching a record 16 million barrels per day in March.
The world’s top oil importer is set to account for nearly 60 per cent of global demand growth in 2023, offsetting, along with India and the Middle East, sluggish demand in developed countries.
The United States and Brazil will lead modest growth in oil supply of 1.2 million barrels per day for the year as OPEC+ cuts agreed in April mean volumes from the producer group will fall 850,000 barrels per day from then through December, the IEA said.
Russian oil exports rose in April to 8.3 million barrels per day, the highest since its invasion of Ukraine, with revenue from the trade up by $1.7 billion on the month to $15 billion, according to the IEA.
Last week, both oil benchmarks gained about 2 per cent in their first weekly rise in five after wildfires shut in large amounts of crude supply in Alberta, Canada.
The impact of voluntary production cuts by OPEC+ is also being felt after going into effect this month.
Oil production in Iraq’s Kurdistan region continued to drop as export flows to Turkey’s Ceyhan port show few signs of restarting after a stoppage that has lasted almost two months.
On Saturday, the Group of Seven (G7) nations pledged at its annual leaders’ meeting to enhance efforts to counter Russia’s evasion of the price caps on its oil and fuel exports.
The G7 singled out China on issues including Taiwan, nuclear arms, economic coercion, and human rights abuses, and this triggered a response from the world’s biggest oil importer, which referred to an “anti-China workshop.”
US President Joe Biden and top congressional Republican Speaker Kevin McCarthy will meet on Monday to discuss raising the federal government’s debt ceiling before the US could face an unprecedented default on June 1.
Oil prices, however, were held in check by a stronger Dollar as the market waited for news on the US debt ceiling talks.
The US Dollar rose against a basket of other currencies, holding just below a two-month high, as investors waited on fresh signals on whether the US Federal Reserve is likely to continue hiking interest rates and watched for news on the US debt ceiling.
A stronger Dollar can weigh on oil demand by making the fuel more expensive for holders of other currencies.
By Modupe Gbadeyanka
To unlock about $50 billion in deep offshore investment, President Bola Tinubu has signed the Deep Offshore Oil and Gas Projects Incentives (Tax Remission) Order, 2026, stressing that the aim is “to make Nigeria Africa’s regional hub for deep offshore project execution.”
In a statement personally signed by him on Wednesday, the Nigerian leader disclosed that he approved the executive order to create a clear and predictable framework for the sector.
According to him, the approval has already attracted approximately $10 billion for the Bonga South West project.
He stated that for projects accessing the supplementary incentives, the Order requires activities to be performed in Nigeria, subject to clearly defined exceptions and Nigerian content requirements.
The President noted that this part was included because “I want the work to come home to Nigeria. I want our engineers involved, our fabrication yards working, Nigerian marine and technical service companies securing contracts, and our young people acquiring world-class skills.”
“For me, the real measure of $50 billion will be what Nigerians see from it: good jobs, stronger Nigerian businesses, greater production, more revenue for the Federation and capabilities built here at home. Our natural resources must work harder for our people,” he added.
Mr Tinubu stated that this order is the tenth major policy directive of his administration targeted specifically at the oil and gas sector.
“We have been deliberate about removing the constraints holding back investment, production and value creation.
“For too long, some of our biggest offshore opportunities have remained stalled. We cannot afford to leave that opportunity beneath our waters for another decade. Capital moves, countries compete for it, and investors committing billions of dollars over many years need certainty,” he disclosed.
According to him, “We are providing that certainty, with a clear window for existing deep offshore leases to reach Final Investment Decision by 31 December 2029 and qualify for the full standard incentive.”
By Adedapo Adesanya
The NASD Over-the-Counter (OTC) Securities Exchange extended its stay in the red territory for a second consecutive session on Tuesday, August 11, declining by 1.81 per cent.
This pulled back the market capitalisation by N8.94 billion to N2.748 trillion from N2.798 trillion, and the NASD Security Index (NSI) dropped 84.44 points to 4,578.74 points from 4,663.18 points.
The market breadth index was at equilibrium yesterday, as there were four price gainers and four price losers.
On the red side, Central Securities Clearing System (CSCS) Plc depreciated by N12.86 to N116.88 per share from N129.74 per share, Afriland Properties Plc declined by N1.95 per cent to N22.00 per unit from N23.95 per unit, Food Concepts Plc weakened by 25 Kobo to N2.50 per share from N2.75 per share, and Geo-Fluids Plc lost 22 Kobo to sell at N2.05 per unit versus Monday’s N2.27 per unit.
On the green side, FrieslandCampina Wamco Nigeria Plc gained N11.50 to finish at N156.50 per share compared with the previous day’s N145.00 per share, Nitrox Industrial Gases Plc expanded by N2.11 to N23.36 per unit from N21.15 per unit, NASD Plc advanced by N1.90 to N36.00 per share from N34.10 per share, and Nipco Plc surged by 50 Kobo to N457.00 per unit from N456.50 per unit.
During the session, the volume of securities rose by 31.2 per cent to 1.5 million units from 1.1 million units, the value of securities improved by 315.9 per cent to N42.3 million from N10.2 million, and the number of deals skyrocketed by 45.7 per cent to 51 deals from Monday’s 35 deals.
Great Nigeria Insurance (GNI) Plc ended as the most active stock by value (year-to-date), with 3.4 billion units valued at N8.4 billion, trailed by Infrastructure Credit Guarantee (Infracredit) Plc with 2.3 billion units sold for N6.5 billion, and CSCS Plc with 77.0 million units transacted for N5.5 billion.
GNI Plc also closed as the most active stock by volume (year-to-date), with 3.4 billion units worth N8.4 billion, followed by Infracredit Plc with 2.3 billion units exchanged for N6.5 billion, and Resourcery Plc with 1.1 billion units traded for N415.7 million.
By Dipo Olowookere
The Nigerian Exchange (NGX) Limited tumbled by 0.73 per cent on Tuesday on the back of profit-taking by investors.
The consumer goods counter shed 0.96 per cent, and the banking space crashed by 0.46 per cent due to selling pressure. But the insurance index gained 0.24 per cent, and the energy segment improved by 0.03 per cent, while the industrial goods sector closed flat.
When the bourse closed for the session, the All-Share Index (ASI) gave up 1,806.18 points to 246,723.57 points from 248,529.75 points, and the market capitalisation depreciated by N1.166 trillion to N159.256 trillion from N160.422 trillion.
Thomas Wyatt lost 9.97 per cent to quote at N2.89, AVA Capital declined by 9.60 per cent to N8.95, International Energy Insurance dipped by 6.32 per cent to N4.00, International Breweries dropped 5.98 per cent to close at N11.00, and Guinea Insurance shed 5.13 per cent to 74 Kobo.
On the flip side, UPDC REIT gained 10.00 per cent to end at N14.85, FTN Cocoa appreciated by 9.88 per cent to N8.90, C&I Leasing surged by 8.26 per cent to N5.90, Sovereign Trust Insurance went up by 6.74 per cent to N1.90, and Regency Alliance climbed 6.33 per cent to 84 Kobo.
Yesterday, Fortis Global Insurance was the busiest equity, leading the activity chart with a turnover of 3.3 billion units worth N9.6 billion. Trans-Nationwide Express transacted 84.6 million units for N181.9 million, Access Holdings sold 66.1 million units valued at N1.9 billion, Consolidated Hallmark exchanged 54.3 million units worth N379.4 million, and Fidelity Bank traded 46.9 million units for N1.0 billion.
Investors bought and sold 3.9 billion units worth N32.4 billion in 45,608 deals compared with the 1.1 billion units valued at N27.0 billion traded in 59,185 deals a day earlier. This indicated that the number of deals retreated by 22.94 per cent, the trading volume increased by 254.55 per cent, and the trading value soared by 20.00 per cent.
