Economy
OPEC+ Retains Nigeria’s Output Benchmark at 1.5mbpd
By Adedapo Adesanya
Nigeria’s daily oil production quota will remain unchanged at 1.5 million barrels per day after the Organisation of Petroleum Exporting Countries and its allies (OPEC+) on Thursday deferred the commencement of its proposed oil production cuts by a year, until the end of 2026.
The move was necessitated by weak demand and rising output by non-members of the international oil cartel.
OPEC sets a production target for its members as a way of curbing oversupply and ensuring price stability.
The alliance agreed to extend the 2 million barrels per day and the 1.65 million barrels per day of cuts until the end of 2026 from the end of 2025 respectively, according to statements issued by the group on Thursday.
However, Nigeria which has been a laggard struggled for years to meet its monthly allocation of 1.78 million barrels per day minus condensates as prescribed by the group.
The country quota was revised then downwards to 1.5 million barrels per day in 2022.
Under its formal output strategy, the broader OPEC+ coalition is now restricting its combined production to 39.725 million barrels per day until December 31, 2026, after previously only applying this quota throughout 2025.
However, eight OPEC+ members — Saudi Arabia, Russia, Iraq, the United Arab Emirates, Kuwait, Kazakhstan, Algeria, and Oman — will now extend their 2.2 million barrels per day voluntary production decline into the first quarter, and will begin hiking production incrementally between April and September 2026.
Nigeria, unable to meet its 1.5 million barrels per day, does not belong to this exclusive group. OPEC data puts Africa’s largest oil producer numbers at 1.3 million barrels on average.
Saudi Arabia’s quota will stand at 10.47 million barrels per day; Russia’s at 9.94 million barrels per day; Iraq’s at 4.43 million barrels per day production and Algeria’s at 1 million barrels per day output.
Despite these sets of production trims and ongoing conflict threatening the hydrocarbon-rich Middle Eastern region, global oil prices have remained subdued for the better part of this year, under pressure from a tepid demand outlook.
Brent crude, which Nigeria leverages its headline crude against, is currently trading at $72 per barrel.
Meanwhile, Nigeria has set an ambitious 2025 production target of 2.06 million barrels per day, inclusive of condensates, as outlined in the draft 2025 appropriation bill of N48.7 trillion. The bill also sets a $77 per barrel benchmark to fund the budget.
By Adedapo Adesanya
The NASD Over-the-Counter (OTC) Securities Exchange extended its presence in the green territory with a 0.07 per cent growth on Tuesday, January 7, spurred by a gain recorded by Central Securities Clearing System (CSCS) Plc.
At the close of business yesterday, the Nigerian securities depository company increased its share price by 15 Kobo to end at N23.20 per unit compared with the previous day’s N23.05 per unit.
As a result of this, the market capitalisation of the bourse went up by N750 million to finish at N1.056 trillion like the preceding session, and the NASD Unlisted Security Index (NSI) expanded by 2.18 points to wrap the session at 3,080.29 points compared with 3,080.47 points recorded at the previous session.
The market was relatively quiet on Tuesday as investors reconsidered their exposure to unlisted securities, with the volume of transactions declining by 96.8 per cent to 59,432 units from the 1.8 million units achieved a day earlier.
In the same vein, the value of trades recorded yesterday decreased by 89.9 per cent to N2.1 million from N20.7 million, and the number of deals slumped by 79.3 per cent to six deals from 29 deals.
FrieslandCampina Wamco Nigeria Plc ended the session as the most active stock by value (year-to-date) with 1.9 million units worth N74.2 million, trailed by 11 Plc with 12,963 units valued at N3.2 million, and Industrial and General Insurance (IGI )Plc with 10.7 million units sold for N2.1 million.
IGI Plc finished the trading session as the most active stock by volume (year-to-date) with 10.6 million units valued at N2.1 million, followed by FrieslandCampina Wamco Nigeria Plc with 1.9 million units sold for at N74.2 million, and Acorn Petroleum Plc with 1.2 million units worth N1.9 million.
By Adedapo Adesanya
It was a bad day for the Nigerian Naira in the Nigerian Autonomous Foreign Exchange Market (NAFEM) on Tuesday, January 7 as its value weakened further by 0.03 per cent or 45 Kobo to trade at N1,537.03/$1, in contrast to the preceding day’s N1,536.58/$1.
Equally, the domestic currency depreciated against the British Pound Sterling in the official market yesterday by N21.60 to wrap the session at N1,924.15/£1 compared with Monday’s closing price of N1,902.55/£1 and against the Euro, it lost N15.55 to quote at N1,595.07/€1 compared with the previous day’s N1,579.52/€1.
However, in the black market, the Naira traded flat against the US Dollar during the trading session at N1,655/$1 as the spot market battles fresh FX demand pressure.
Meanwhile, ihe cryptocurrency market was largely negative as two stronger-than-expected US economic data placed pressure on digital assets’ bright early-year momentum.
Job openings for November unexpectedly rose to 8.1 million from 7.8 million the previous month, easily topping analyst estimates for a decline to 7.7 million while the ISM Services Purchasing Managers Index, a monthly gauge of the level of economic activity in the services sector, came in at 54.1 for December, overshooting expectations for 53.3 and nicely ahead of November’s 52.1.
Market analysts noted that combined together, both data shook up an already jittery market.
The biggest loser was Dogecoin (DOGE), which recorded a value depreciation of 11.6 per cent to sell at $11.6, Cardano (ADA) slid by 10.9 per cent to trade at $0.9768, Litecoin (LTC) tumbled by 10.1 per cent to $101.89, and Solana (SOL) slumped by 10.0 per cent to finish at $194.73.
Further, Ethereum (ETH) went down by 9.5 per cent to close at $3,321.85, Ripple (XRP) dropped 6.4 per cent to sell at $2.29, Bitcoin (BTC) recorded a 6.1 per cent fall to trade at $95,647.42, and Binance Coin (BNB) depreciated by 6.0 per cent to $95,647.42, while the US Dollar Tether (USDT) and the US Dollar Coin (USDC) remained stable at $1.00 flat.
By Adedapo Adesanya
Oil prices went up on Tuesday, driven by concerns over limited supply from Russia and Iran because of Western sanctions and expected higher Chinese demand, with Brent crude futures increasing by 75 cents or 0.98 per cent to $77.05 per barrel and the US West Texas Intermediate (WTI) crude futures grew by 69 cents or 0.94 per cent to $74.25 a barrel.
The US on Tuesday ramped up sanctions on Iran, targeting 35 entities and vessels it said carried illicit Iranian petroleum to foreign markets as part of what the US Treasury Department called Tehran’s “shadow fleet.”
The sanctions build on those imposed on October 11 and come in response to Iran’s October 1 attack on Israel and to its announced nuclear escalations, the Treasury Department said in a statement.
The move generally prohibits US individuals or entities from doing business with the targets and freezes US-held assets.
Meanwhile, cold weather in the US and Europe boosted heating oil demand, though oil price gains were capped by global economic data.
Eurozone inflation accelerated in December, an expected blip that is unlikely to derail further interest rate cuts from the European Central Bank.
Market analysts noted that the higher inflation in Germany raised suggestions the European Central Bank (ECB) may not be able to cut rates as fast as hoped across the bloc.
Market participants await more economic data, including the US December non-farm payrolls report on Friday.
On the supply end, a member of the Organisation of the Petroleum Exporting Countries and its allies, OPEC+, South Sudan, will resume oil production on Wednesday after Sudan lifted the force majeure on the pipeline route through Sudan and onto Port Sudan on the Red Sea.
Earlier this month, Sudan lifted the 10-month-long force majeure on the oil flows from landlocked South Sudan through its neighbor to the north, Sudan, following new security arrangements and improved security conditions.
In March 2024, Sudan declared force majeure on crude oil exports from its South Sudan, following a major rupture in the pipeline carrying crude from South Sudan to the port in Sudan in an area with active military activity.
The American Petroleum Institute (API) estimated that crude oil inventories in the United fell by 4.022 million barrels for the week ending January 3. For the week prior, the API reported a draw of 1.442-million-barrel in US crude oil inventories in the midst of build season.
In 2024, crude oil inventories dropped by more than 12 million barrels, according to the API’s inventory data.
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