Economy
Rising Oil Price: CBN Urges FG to Save to Avert Another Recession
By Dipo Olowookere
The Central Bank of Nigeria (CBN) on Tuesday warned of a looming fall into another recession if efforts are not being made to boost the economy.
This warning was given at the end of the two-day Monetary Policy Committee (MPC) meeting held in Abuja.
Addressing reporters yesterday, CBN Governor, Mr Godwin Emefiele, noted that during the meeting, the committee identified rising inflation and pressure on external reserves created by capital flow reversal as the current challenges to growth.
According to him, inflationary pressures have started rebuilding and capital flow reversals have intensified as shown by the bearish trend in the equities market even though the exchange rate remains very stable.
Mr Emefiele told newsmen that at the July meeting of the MPC, members had lauded the modest stability achieved in key indicators, including inflation, exchange rate and external reserves, buoyed by a robust level of external reserves with inflation trending downwards for the 18th consecutive month.
However, he emphasised that the gains recorded as at the last time the committee met before yesterday appear to be under threat of reversal, following new data which provides evidence of weakening fundamentals.
He said available data from the National Bureau of Statistics (NBS) showed that real GDP growth declined by 45 basis points as the economy grew by 1.50 percent in the second quarter of 2018, down from 1.95 percent in the preceding quarter, but higher than 0.72 percent in the corresponding quarter of 2017.
“The committee was concerned that the exit from recession may be under threat as the economy slowed to 1.95 and 1.50 percent in Q1 and Q2 2018, respectively,” Mr Emefiele said during the briefing.
He said the committee attributed the slowdown in economy to drop in the oil sector, with strong linkages to employment and growth in other key sectors of the economy.
According to him, in order to avoid another recession, federal government must take advantage of the current rising oil prices to rebuild fiscal buffers, strengthen government finances in the medium term and reverse the current trend of decline in output growth.
“The MPC also called on the fiscal authorities to intensify the implementation of the Economic Recovery and Growth Plan (ERGP) to stimulate economic activity, bridge the output gap and create employment,” he said.
The CBN chief further disclosed that the committee noted that disruptions to the food supply chain in major food producing states due to the combined effects of poor infrastructure, flooding and the on-going security challenges resulted in a rise in food prices, contributing to the uptick in headline inflation.
However, he said the committee expressed optimism that as harvests progress in the coming months, pressure on food prices would gradually recede, while growth enhancing measures would over the medium term have some moderating impact on food prices.
He said the MPC was of the view that even though growth remained weak, the effective implementation of the 2018 capital budget and policies that would encourage credit delivery to the real sector of the economy would boost aggregate demand, stimulate economic activity and reduce unemployment in the country.
Business Post recalled that in the second quarter of 2016, Nigeria slipped into recession and only exited in the second quarter of 2017.
Some weeks ago, the Statistician General of the federation, Mr Yemi Kale, disclosed that the Nigerian economy was presently in a recovery stage.
By Dipo Olowookere
The loss recorded by Customs Street on Monday was reversed on Tuesday after closing higher by 0.46 per cent due to renewed buying interest from investors.
Almost all the key sectors of the bourse ended in green during the trading session except the commodity index, which closed flat.
The consumer goods counter expanded by 1.70 per cent, the insurance space grew by 0.88 per cent, the energy sector increased by 0.83 per cent, the banking industry improved by 0.20 per cent, and the industrial goods sector advanced by 0.13 per cent.
Consequently, the All-Share Index (ASI) went up by 501.13 points to 108,762.60 points from the 108,261.47 points recorded a day earlier, and the market capitalisation gained N315 billion to settle at N68.358 trillion compared with the previous day’s N68.043 trillion.
A total of 40 stocks ended on the price gainers’ chart of the Nigerian Exchange (NGX) Limited during the trading day and 24 stocks finished on the losers’ chart, indicating a positive market breadth index and strong investor sentiment.
Chellarams grew by 10.00 per cent to sell for N11.44, Oando also chalked up 10.00 per cent to close at N49.50, Transcorp rose by 9.99 per cent to N46.25, Beta Glass jumped by 9.96 per cent to N194.30, and Caverton flew by 9.85 per cent to N3.68.
On the flip side, Haldane McCall lost 9.85 per cent to finish at N4.21, Academy Press declined by 7.33 per cent to N4.30, UPDC weakened by 6.25 per cent to N3.00, ABC Transport crashed by 6.13 per cent to N2.91, and NPF Microfinance Bank retreated by 5.14 per cent to N2.03.
The demand for Nigerian stocks was higher on Tuesday, resulting in the rise in the trading volume by 21.62 per cent to 498.5 million shares from the 409.9 million shares transacted a day earlier.
Similarly, the trading value increased by 1.89 per cent to N10.8 billion from N10.6 billion, while the number of deals decreased by 9.28 per cent to 14,916 deals from 16,441 deals.
Tantalizers was the busiest equity for the day with a turnover of 57.8 million units valued at N131.3 million, Access Holdings transacted 36.8 million units worth N784.4 million, GTCO exchanged 31.8 million units for N2.2 billion, Fidelity Bank traded 23.4 million units worth N470,5 million, and Nigerian Breweries sold 21.0 million units valued at N1.1 billion.
By Adedapo Adesanya
Crude oil prices climbed by about 2 per cent a barrel on Tuesday, lifted by a temporary cut in US-China tariffs and a better-than-expected inflation report.
The Brent crude grade was up by $1.67 or 2.57 per cent to $66.63 a barrel, and the US West Texas Intermediate (WTI) crude grade finished at $63.67 after gaining $1.72 or 2.78 per cent.
The US and China had recently agreed on sharp reductions to their import tariffs for at least 90 days, which has offered relief to the markets.
The US agreed to slash duties on Chinese goods to 30 per cent for the next 90 days while tariffs on US goods imported into China would decline to 10 per cent from 125 per cent.
Further supporting the market, the US Labor Department reported on Tuesday that the Consumer Price Index rose 2.3 per cent in the 12 months through April, the smallest year-over-year gain in four years.
The Consumer Price Index increased 0.2 per cent last month after dipping 0.1 per cent in March, which was the first decline since May 2020, the Labor Department’s Bureau of Labor Statistics said.
The data suggested price pressures were cooling before President Donald Trump’s chaotic tariffs policy and did not change economists’ views that the Federal Reserve would continue to pause its interest rate-cutting cycle until late in the summer.
The US central bank has paused its rate cuts amid concerns that the trade war could reignite inflation. It kept its benchmark interest rate unchanged since last cutting it in December.
This development has also led banks like JPMorgan Chase and Barclays to cut their forecasts of a US recession in the coming months.
On the supply front, the Organization of the Petroleum Exporting Countries and its allies (OPEC+), are planning to boost oil exports in May and June, which is seen as possibly limiting oil’s upside.
OPEC has raised oil output by more than previously expected since April, with its May output likely to increase by 411,000 barrels per day.
Reuters reported that Saudi Arabia’s crude oil supply to China will hold steady in June after hitting its highest level in more than a year in the previous month after an OPEC+ decision to increase output.
Market analysts, however, warned that if China talks stall or supply outpaces refining capacity, the recent rally could be short-lived.
By Adedapo Adesanya
APM Terminals Apapa has reported a 31.5 per cent increase in export volumes for April 2025, reaching its highest monthly figure since operations began in 2006.
The terminal handled 8,687 twenty-foot equivalent units (TEUs) of export cargo, up from 6,606 TEUs in April 2024.
According to the terminal manager, Mr Steen Knudsen, this underscores a major milestone in Nigeria’s growing export momentum and reflects years of sustained growth and strategic investment in export infrastructure.
“It’s advantageous for Nigerian shippers when ships depart our ports fully loaded with exports. Preventing ships from leaving empty positively influences the overall cost of shipments into Nigeria,” he said.
Mr Knudsen attributed the growth to targeted operational improvements and alignment with national economic priorities.
“Our aim aligns with the Federal Government’s vision of transforming Nigeria into an export-driven economy. To support this, we launched a new rail service in February to expedite the movement of goods from the hinterland to Apapa port,” he revealed.
“We’ve expanded our yard capacity for exports and introduced dedicated truck lanes to streamline the process, reducing the time exports spend in the terminal and ensuring timely ship departures,” he added.
Mr Knudsen praised top agencies including Nigerian Ports Authority (NPA) and Nigerian Railway Corporation (NRC) for their support in enabling the terminal to focus on delivering top-tier services to its customers.
Since acquiring the Apapa concession, the company has made significant capital investments to boost capacity, efficiency, and overall terminal productivity.
In the last four years, APM Terminals Apapa has recorded a steady rise in export volumes. In 2022, the terminal handled 53,807 TEUs of exports. This number rose to 70,432 TEUs in 2023 and 77,631 TEUs in 2024.
As Nigeria’s largest container terminal and a subsidiary of the A.P. Moller Maersk Group, APM Terminals Apapa continues to play a central role in the modernization and expansion of the country’s maritime logistics network.
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