Economy

What Nigeria Gains From US-Iran Crisis

Published

6 years ago

07/01/2020

By Adedapo Adesanya

On Friday, January 3, 2020 the United States president, Mr Donald Trump, ordered an airstrike, which killed top Iranian General, Mr Qassem Soleimani, the head of Iran’s elite Quds military force and one of the most powerful figures in the country.

This spurred hike in oil prices as Brent crude oil futures, the global benchmark, coursed more than 4 percent, while the West Texas Intermediate (WTI) crude oil jumped more than 3 percent due to the escalation of the geopolitical tensions between the U.S. and Iran.

For a country like Nigeria, whose mainstay is oil, this development turned out to be a blessing because global events, which badly affect prices oil, have always been a major source of worry for government due to low revenues generated from the sale of the black gold.

But with the ongoing tensions from the assassination of the Iranian military chief, more money would continued to be raked from the sale of crude oil at higher prices.

In fact, Nigeria will like prices of oil to continue to trend higher at the global market because in the 2020 budget, the benchmark for crude oil was pegged at $60 per barrel.

Since last Friday, when the unmanned US drone attacked Mr Soleimani, prices have hovered around $70 (on Friday, January 3), $69 dollars over the weekend, and as the time of this report at $68 per barrel. This means prices are still in a safe net for the country.

By estimates, Nigeria produces over 1.5 million barrels of oil per day and at with an average increase of $69 per barrel since Friday, according to analysis by Business Post, the country has raked over $400 million so far from the sale of the commodity.

However, analysts have noted that a further escalation of the Mideast tensions could drive prices up as Iran’s Supreme Leader Ayatollah Ali Khamenei has vowed to inflict “severe retaliation” on those involved in Mr Soleimani’s death, and following this, the United States has also strengthened its military presence in and around the region.

A retaliation means that oil will rise with analysts saying that Iran’s could initiate attacks on oil tankers in the Persian Gulf, as it did in 2019 with a British tanker and a number of drones. This would provide support for oil prices but would be not hold on for much longer.

A bigger occurrence would be an attack on oil infrastructure of US allies in the Persian Gulf such as the September strikes on Saudi oil infrastructure, which led to a loss of 5.7 million barrels per day of oil production capacity when Iranian-backed Houthi rebels attacked the facilities.

The biggest would be if Iran closed off the Strait of Hormuz, which serves as a passageway for a major portion of the oil supply. Such an action would limit access to Asian markets where China, India, Japan and South Korea, some of the largest consumers are located.

However, even with the possible rise, oil prices face huge pressure from non-OPEC supplier like the United States, Brazil, and Norway, who would want to increase their output and eventually crash prices or lead the market to an oversupply which the OPEC and its allies – which includes Nigeria took a decision to curb by reducing oil production by 1.7 million barrels per day to help prices and stop oil glut this year.

But whichever way, Nigeria will continue to cash in on the crisis and use the opportunity to shore up its external reserves, which have depleted in recent times due to low prices of crude oil.

Economy

Naira Crashes to N1,420/$1 at Official FX Market

Published

9 minutes ago

15/01/2026

Adedapo Adesanya

By Adedapo Adesanya

The Naira crashed against the United States Dollar on Wednesday, January 14 by 38 Kobo or 0.03 per cent in the Nigerian Autonomous Foreign Exchange Market (NAFEM) to N1,420.04/$1, in contrast to the N1,419.66/$1 it was traded a day earlier.

Despite the decline in the daily value of the Naira against the greenback in the official FX market, the near-term projection indicate that with continued support by the Central Bank of Nigeria (CBN), stronger external inflows from foreign portfolio investors (FPIs), and improving current account dynamics, the local currency will remain within projected range.

The country’s external reserves continued to swell as it added $40.26 million to the previous day’s balance, bringing total reserves to $45.78 billion.

Data showed that the domestic currency firmed up against the Pound Sterling in the spot market by N2.89 to trade at N1,911.09/£1 versus Tuesday’s closing rate of N1,913.98/£1 and gained N1.11 against the Euro to finish at N1,655.48/€1 compared with the previous day’s value of N1,656.59/€1.

At the GTBank forex desk, the Nigerian currency gained N4 on the US Dollar to sell for N1,427/$1, in contrast to the preceding session’s N1,431/$1 but closed flat at the black market at N1,490/$1.

A look at the cryptocurrency market showed that most of the tracked tokens were under pressure as broader financial markets turned cautious of the US-Iran rhetoric, which affect risk assets like crypto.

US President Donald Trump signaled he may delay military action against Iran, easing immediate geopolitical tensions.

With upcoming U.S. economic data unlikely to shift expectations for a Federal Reserve rate cut before midyear, traders are watching whether crypto can hold positive positions despite softer equity markets.

During the trading day, Litecoin (LTC) declined by 4.9 per cent to $74.70, Cardano (ADA) slumped by 4.3 per cent to $0.4024, Dogecoin (DOGE) went down by 2.6 per cent to $0.1433, Ripple (XRP) slipped by 2.0 per cent to $2.09, Ethereum (ETH) shrank by 0.13 per cent to $3,319.40, and Binance Coin (BNB) depreciated by 0.05 per cent to $936.13.

On the gainers’ angle, Bitcoin (BTC) led with an appreciation of 2.9 per cent to sell at $96,474.70, and Solana (SOL) grew by 0.3 per cent to $144.49, while the US Dollar Tether (USDT) and the US Dollar Coin (USDC) traded flat at $1.00 each.

Economy

Energy Stocks, Others Buoy Customs Street by 0.56%

Published

25 minutes ago

15/01/2026

Dipo Olowookere

By Dipo Olowookere

It was another trading session in the green territory for Customs Street on Wednesday as it closed higher by 0.56 per cent as investors doubled down on their confidence in the market.

The Nigerian Exchange (NGX) Limited rallied despite the consumer goods sector going down by 0.20 per cent due to profit-taking by traders.

According to data, the 6.26 per cent gain recorded by the energy space and the others contributed to the growth achieved by bourse at midweek.

Business Post reports that the commodity index was up by 3.35 per cent, the insurance counter expanded by 0.78 per cent, the banking index grew by 0.05 per cent, and the industrial goods sector advanced by 0.01 per cent.

As a result, the All-Share Index (ASI) of the platform was swollen by 934.63 points to 166,771.95 points from 165,837.32 points as the market capitalisation inflated by N599 billion to N106.781 trillion from N106.182 trillion.

During the session, there were 47 price gainers and 28 price losers, implying a positive market breadth index and bullish investor sentiment.

Academy Press gained 10.00 per cent to close at N8.25, NCR Nigeria improved by 9.98 per cent to N106.30, Tripple G surged by 9.95 per cent to N4.86, Tantalizers rose by 9.93 per cent to N2.99, and McNichols leapt by 9.92 per cent to N7.31.

On the flip side, May and Baker lost 9.79 per cent to trade at N28.55, Coronation Insurance shed 6.76 per cent to settle at N3.31, Livestock Feeds declined by 6.67 per cent to N7.00, PZ Cussons moderated by 6.52 per cent to N54.50, and Eterna gave up 6.30 per cent to quote at N34.20.

It was a quiet market day on Wednesday as the level of activity dropped, as Access Holdings, which led the chart by volume, only transacted 53.4 million shares valued at N1.2 billion, Lasaco Assurance traded 39.0 million stocks worth N100.2 million, Veritas Kapital sold 32.8 million equities for N69.6 million, Tantalizers exchanged 30.1 million shares worth N89.6 million, and Deap Capital traded 28.6 million stocks valued at N114.1 million.

At the close of business, a total of 761.9 million equities worth N29.9 billion exchanged hands in 55,751 deals compared with the 1.1 billion equities valued at N33.6 billion transacted in 49,216 deals on Tuesday, indicating a shortfall in the trading volume and value by 30.74 per cent and 11.01 per cent apiece, and a leap in the number of deals by 13.28 per cent.

Economy

Oil Falls as Trump Cools Possible Attack on Iran

Published

47 minutes ago

15/01/2026

Adedapo Adesanya

By Adedapo Adesanya

Oil traded lower on Wednesday after US President Donald Trump eased fears of disruptions to Iranian supplies, indicating that killings in Iran’s crackdown on civil unrest were subsiding.

Yesterday, the price of Brent futures declined by 92 cents or 1.41 per cent to $64.55 per barrel while the US West Texas Intermediate (WTI) futures slipped 96 or 1.57 per cent to $60.19 a barrel.

Prices had risen on fears of Iranian supply disruptions due to a potential US attack on Iran and possible retaliation against US regional interests.

President Trump said on Wednesday afternoon he had been told that killings in Iran’s crackdown on nationwide protests were subsiding and he believed there was currently no plan for large-scale executions.

Still, tensions between Iran and the US remained high after Iran had warned US allies in the Middle East it would strike American bases on their soil if the US attacked it. The US began evacuating military personnel from a key Qatar air base on Wednesday.

While markets may have cooled somewhat on the back of President Trump’s comments, protests in Iran have persisted, and there remains plenty of uncertainty over what might come next.

Market analysts noted that continued protests in Iran risk tightening global oil balances through near-term supply losses, but mainly through rising geopolitical risk premium.

However, this remains somewhat minimal as the protests had not spread to the main Iranian oil-producing areas, which had limited the effect on actual supply.

Also supporting oil prices, Federal Reserve Bank of Minneapolis President Neel Kashkari said on Wednesday he was optimistic about the economic outlook and expected inflation to ease.

It is also looking increasingly likely that Venezuela’s oil supply is set to return to markets, with the US completing its first sale of Venezuelan oil on Wednesday.

Two supertankers departed Venezuelan waters on Monday with about 1.8 million barrels each of crude in what may be the first shipments of a 50 million-barrel supply deal between Venezuela and the US to get exports moving again following the capture of Venezuelan President Nicolas Maduro.

Crude oil inventories in the US increased by 3.4 million barrels during the week ending January 14, according to new data from the US Energy Information Administration (EIA) released on Wednesday.

The EIA’s data release follows figures by the American Petroleum Institute (API) that were released a day earlier, which suggested that crude oil inventories grew by 5.27 million barrels.