Economy
OPEC+ Sticks to Gradual Ease of Oil Production for June
By Adedapo Adesanya
The Organisation of the Petroleum Exporting Countries and its allies (OPEC+) agreed on Tuesday to continue gradually easing production cuts amid a rebound in oil prices.
The alliance of oil producers which consists of the original OPEC members and other producers led by Russia will boost output in July, in accordance with the group’s April decision to return 2.1 million barrels per day to the market between May and July.
However, the production policy beyond July was not decided on, and the group will meet again on July 1.
This came as no surprise as the market expected no change despite considerations of rising COVID-19 cases in India and the possibility of Iranian oil coming back on the market.
The alliance had announced massive crude production cuts in 2020 in an effort to support prices when the coronavirus pandemic coincided with a historic demand shock following a brief oil war.
OPEC+ initially agreed to cut oil production by a record of 9.7 million barrels per day last year as global fuel demand collapsed, before easing cuts to 7.7 million and eventually 7.2 million from January. By July, the group’s production cuts will be on track to stand at 5.8 million barrels per day.
OPEC Secretary-General, Mr Mohammad Barkindo said on Monday that he did not believe higher Iranian supply would be a cause for concern for the cartel’s plan.
“We anticipate that the expected return of Iranian production and exports to the global market will occur in an orderly and transparent fashion,” Mr Barkindo said in a statement.
Iran, which is exempt from the present cut agreement, is in discussions with six world powers to revive its 2015 nuclear deal. The restoration of a deal could lead to more oil on the global market in the coming months.
Nigeria Records Lesser Production as Oil Output Rises in May
Nigeria, a key member of the curb agreement, was one of the producers that limited the growth of oil that entered the market last month, according to a Reuters survey.
In Nigeria, exports slowed from a number of terminals even as OPEC oil output rose in May following the group agreement to ease supply curbs under a pact with allies.
Also, a drop in Iranian exports and involuntary reductions in Angolan exports also aided in limiting the pumping of more oil.
The 13-member cartel pumped 25.52 million barrels per day in May, the survey found, up 280,000 barrels per day from April, indicating that output has risen every month since June 2020 with the exception of February.
The OPEC+ agreement allows for a 277,000 barrels per day increase in OPEC output in May versus April, plus Saudi Arabia had pledged to add 250,000 barrels per day as part of a plan to gradually loosen a 1 million barrel per day voluntary cut had made in February, March and April.
But with reductions in other countries offsetting the Saudi move, the increase in May OPEC supply output found by the survey is less than expected, and the group is still pumping much less than called for under the deal.
OPEC compliance with pledged cuts was 122 per cent in May against 123 per cent in April.
The biggest increase in May of 340,000 barrels per day came from Saudi Arabia, OPEC’s largest producer, as it began to unwind the voluntary cut and raised output as part of the May 1 OPEC+ boost.
OPEC’s Number 2 producer, Iraq also pumped more in May, the survey found, adding an extra 70,000 barrels per day and pushing output beyond its quota.
Libya, one of the OPEC members also exempt from making voluntary cuts, boosted output in May after a force majeure on oil loadings from the port of Hariga was lifted.
By Adedapo Adesanya
The federal government is offering two new savings bonds with interest rates between 17 and 18 per cent through the Debt Management Office (DMO).
In a statement by the agency, the country said retail investors can purchase the two-year bond maturing in January 2027 at 17.23 per cent interest, while the three-year paper maturing in January 2028 at a coupon rate of 18.23 per cent.
Bonds are very safe financial instrument that serve as investments because they are backed by the federal government, which promises to pay back the money.
According to the DMO, people can buy these bonds starting January 13, 2025, until January 17, 2025, with allotment expected on January 22, 2025, and the interest to be paid to investors every three months – in April, July, October, and January.
These bonds have some special features. They are tax-free under both company and personal tax laws.
Big investors like pension funds and trustees are allowed to buy them and each bond costs N1,000 each.
However, interested investor can only buy at least N5,000 worth, and can’t buy more than N50 million.
This comes after the Ms Patience Oniha-led debt office said the Nigerian government was offering three bonds worth N150 billion in September 2024.
By Aduragbemi Omiyale
The House of Representatives has said it would make efforts to pass the controversial tax reform bills forwarded to the National Assembly by President Bola Tinubu last year.
Mr Tinubu, in a bid to improve revenue of the government, asked the parliament to pass the bills, but this has been resisted mostly by northern lawmakers and others.
At the resumption of plenary session on Tuesday in Abuja, the Speaker of the House of Representatives, Mr Abbas Tajudeen, assured that the green chamber of the legislative arm of government would prioritise the tax reform bills.
“The legislative agenda of the House for 2025 prioritises the passage of the Appropriation Bill and the Tax Reform Bills, both of which are pivotal to economic recovery and fiscal stability.
“These reforms are essential for broadening the tax base, improving compliance and reducing dependency on external borrowing.
“The House will ensure that these reforms are equitable and considerate of the needs of all Nigerians, particularly the most vulnerable,” Mr Abbas said through the Deputy Speaker, Mr Ben Kalu, who presided over the session.
He also expressed grief over the loss of lives in stampedes in Ibadan, Abuja and Anambra State last month due to hardship in the country.
Several Nigerians died in the stampedes while trying to receive palliatives given to alleviate their sufferings.
“Tragic events, such as the stampedes in Ibadan, Abuja and Okija, during the distribution of palliative aid, underline the urgent need for improved planning and safety protocols in humanitarian efforts. On behalf of the House, I extend our deepest sympathies to the families and communities affected.
“These incidents serve as a stark reminder of the socio-economic hardships facing our citizens and the imperative for policies that tackle hunger and poverty at their roots.
“Turning to the economy, 2024 presented both difficulties and opportunities. While inflation remains a pressing concern, progress in GDP growth and the positive trajectory of economic reforms provide hope for a more stable and prosperous 2025,” the Speaker said.
By Adedapo Adesanya
The NASD Over-the-Counter (OTC) Securities Exchange recorded a 0.69 per cent appreciation on Monday, January 13, as investors showed renewed interests in unlisted securities.
During the trading session, the NASD Unlisted Security Index (NSI) increased by 21.07 points to wrap the session at 3,095.00 points compared with the 3,073.93 points recorded in the previous session.
In the same vein, the value of the local alternative stock exchange went up by N7.22 billion to close at N1.061 trillion compared with last Friday’s N1.051 trillion.
Yesterday, FrieslandCampina Wamco Nigeria Plc recorded a growth of N3.78 to close at N42.00 per share versus N38.22 per share, Mixta Real Estate Plc improved by 20 Kobo to end at N2.35 per unit versus the preceding closing rate of N2.15 per unit, and Industrial and General Insurance (IGI) Plc gained 1 Kobo to finish at 25 Kobo per share compared with the previous session’s 24 Kobo per share.
Conversely, Geo-Fluids Plc lost 29 Kobo to quote at N4.56 per unit compared with the preceding day’s N4.85 per unit, and Afriland Properties Plc slid by 75 kobo to end the session at N15.50 per share versus the preceding closing rate of N16.25 per share.
During the session, the volume of securities traded decreased by 27.2 per cent to 3.1 million units from 4.3 million units, the value of securities slumped by 81.5 per cent to N3.2 million from N17.2 million, and the number of deals expanded by 57.9 per cent to 30 deals from 19 deals.
At the close of trades, FrieslandCampina Wamco Nigeria Plc remained the most active stock by value (year-to-date) with 1.9 million units worth N74.2 million, followed by 11 Plc with 12,963 units valued at N3.2 million, and IGI Plc with 10.7 million units sold for N2.1 million.
Also, IGI Plc remained the most traded stock by volume (year-to-date) with 10.6 million units sold for N2.1 million, trailed by FrieslandCampina Wamco Nigeria Plc with 1.9 million units valued at N74.2 million, and Acorn Petroleum Plc with 1.2 million units worth N1.9 million.
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