Economy
World Bank Silent on Conditions for Nigeria’s $1.5bn Loan Request
By Modupe Gbadeyanka
The World Bank Group has remained silent on the conditions it plans to attach to the $1.5 billion loan request from Nigeria.
The administration of President Muhammadu Buhari had announced its intention to approach the global lender for the financial assistance.
The reason was because of the drain in revenue caused by the coronavirus pandemic, which crashed the price of crude oil at the international market.
Nigeria, Africa’s largest economy by size, relies heavily on the sale of oil for foreign earnings and since the outbreak became very pronounced in early 2020, funding of the budget has been threatened.
When Mr Buhari signed the 2020 Appropriation Bill into law last December, the benchmark for crude oil was at $57 per barrel with an average daily production of over 2 million barrels per day.
However, the pandemic forced a downward review in March 2020 to $30 per barrel and later to $25 per barrel this month, with an average daily production of 1.7 million barrels per day.
In April 2020, Nigeria, alongside other oil producers in the world, especially from the Organisation for the Petroleum Exporting Countries (OPEC), agreed to cut global supply by 10 percent to 9.7 million barrels per day.
Under its own quota, the Africa’s largest producer of the of the commodity was asked to reduce its supply to 1.4 million barrels per day in May and June 2020.
This agreement has helped price of crude oil to jump to over $30 per barrel since the deal became effective on Friday, May 1, 2020.
When the coronavirus outbreak affected Nigeria’s economy, the federal government ran to the World Bank to seek for a $1.5 billion loan to help carry out its main duties in the country.
The World Bank has said this request would be considered in two months’ time and a decision announced.
In an interview with Reuters on Friday, the Director of the World Bank for Nigeria, Mr Shubham Chaudhuri, stated that, “We were hoping to present to our board by late July or latest early August, because the government will need the finance.”
Mr Chaudhuri said further that, “The immediate challenge is a fiscal one: How does the government marshal the fiscal resources to keep basic government functions going?”
However, he declined to comment on any conditions the bank hopes the country fulfils before granting the loan.
But the lead economist of World Bank on Nigeria, Mr Marco Hernandez, informed Reuters that, “We have been recommending a move towards a unified exchange rate and a more flexible exchange rate for some time,” emphasising that it would help the recovery and boost investor confidence.
Nigeria operates a multiple exchange rate system and this has been very confusing to investors.
While the official exchange rate is N361 to a Dollar, the exchange rate at the black market is over N450 per Dollar, while at the Investors and Exporters (I&E) window is over N380/$1.
Last Thursday, the Minister of Finance, Budget and National Planning, Mrs Zainab Ahmed, warned that Nigeria’s economy could fall into a recession in 2020 with a 8.9 percent contraction.
The last time the country slipped into an economic crisis was in 2016, a year after Mr Buhari became President. If Nigeria falls into another recession, it would be the second under his administration and the first President to lead the country into recession two times in the same regime.
Business Post reports that last month, the International Monetary Fund (IMF) approved Nigeria’s $3.4 billion loan request. The money was withdrawn from the bank by the country and is expected to be repaid in five years, with two years moratorium.
By Dipo Olowookere
The upward trajectory seen at the Nigerian Exchange (NGX) Limited in the past sessions was halted on Thursday as a result of profit-taking in Aradel Holdings, MTN Nigeria, GTCO, and others.
Nigerian stocks were down by 0.43 per cent because of the selling pressure. It was the first loss in 2026 and also the first in 23 trading session. The last time Customs Street ended in red was December 10, 2025.
The decision of investors to trim their exposure to equities contracted the All-Share Index (ASI) by 714.66 points during the session to 166,057.29 points from 166,771.95 points and brought down the market capitalisation by N458 billion to N106.323 trillion from N106.781 trillion.
A look at the sectorial performance indicated that the energy, commodity, and insurance indices were down by 2.21 per cent, 1.14 per cent, and 0.24 per cent, respectively, while the banking, consumer goods, and industrial goods sectors were up by 0.78 per cent, 0.33 per cent, and 0.01 per cent apiece.
Yesterday, investor sentiment was weak after the bourse ended with 26 price gainers and 41 price losers, showing a negative market breadth index.
McNichols declined by 9.99 per cent to trade at N6.58, Caverton crashed by 9.47 per cent to N7.65, Ikeja Hotel collapsed by 9.43 per cent to N35.05, FTN Cocoa dropped 9.38 per cent to sell for N7.05, and Neimeth went down by 8.91 per cent to N9.20.
On the flip side, Nestle Nigeria gained 10.00 per cent to quote at N2,153.80, NCR Nigeria appreciated by 9.97 per cent to N116.90, Jaiz Bank improved by 9.92 per cent to N8.20, Morison Industries rose by 9.90 per cent to N5.66, and Mecure Industries grew by 9.84 per cent to N97.70.
During the session, market participants traded 1.0 billion stocks worth N31.6 billion in 51,227 deals compared with the 761.9 million stocks valued at N29.9 billion transacted in 55,751 deals at midweek, representing a drop in the number of deals by 8.12 per cent, and a surge in the trading volume and value by 31.25 per cent, and 5.69 per cent, respectively.
Sovereign Trust Insurance returned on top of the activity chart with 245.2 million units sold for N798.5 million, Access Holdings traded 78.4 million units worth N1.8 billion, Zenith Bank transacted 72.4 million units for N5.0 billion, Jaiz Bank exchanged 53.7 million units valued at N433.9 million, and Lasaco Assurance traded 53.4 million units worth N135.1 million.
By Adedapo Adesanya
Crude oil was down by around 4 per cent on Thursday after the United States President, Mr Donald Trump, said the crackdown on protesters in Iran was easing, calming concerns over potential military action against the Middle-East country and oil supply disruptions.
Brent crude futures depreciated by $2.76 or 4.15 per cent to $63.76 a barrel and the US West Texas Intermediate (WTI) crude futures fell by $2.83 or 4.56 per cent, to $59.19 a barrel.
President Trump said he had been told that killings during Iran’s crackdown on protests were easing and he believed there was no current plan for large-scale executions, though he warned that the US was still weighing military action against the oil producer, which is a member of the Organisation of the Petroleum Countries (OPEC).
Thousands of people are reported to have been killed in the weeks-long protests, and the American president has vowed to support demonstrators, saying help was “on its way.”
Iran has threatened the US with reprisals were it to be attacked, alongside conciliatory signals, including the suspension of a protester’s execution.
The New York Times reported that many of the US Gulf allies, including several of Iran’s own rivals, have also pushed against a US military intervention, warning that the ripple effects would undermine regional security and damage their reputations as havens for foreign capital.
Regardless, the US withdrew some personnel from military bases in the Middle East, after a senior Iranian official said Iran had told neighbours it would hit American bases if America strikes.
Venezuela has begun reversing oil production cuts made under a US embargo, with crude exports also resuming. The OPEC member’s oil exports fell close to zero in the weeks after the US imposed a blockade on oil shipments in December, with only Chevron exporting crude from its joint ventures with PDVSA under US license.
The embargo left millions of barrels stuck in onshore tanks and vessels. As storage filled, PDVSA was forced to shut wells and order oil production cuts at joint ventures in the country.
With this development, the Venezuelan state oil company is now instructing the joint ventures to resume output from well clusters that were shut.
On the demand side, OPEC said on Wednesday that 2027 oil demand was likely to rise at a similar pace to this year and published data indicating a near balance between supply and demand in 2026, contrasting with other forecasts of a glut.
By Adedapo Adesanya
Nigeria’s crude oil production slipped slightly to 1.422 million barrels per day in December 2025 from 1.436 million barrels per day in November, according to data from the Organisation of Petroleum Exporting Countries (OPEC).
OPEC in its Monthly Oil Market Report (MOMR), quoting primary sources, noted that the oil output was below the 1.5 million barrels per day quota for the nation.
The OPEC data indicate that Nigeria last met its production quota in July 2025, with output remaining below target from August through December.
Quarterly figures reveal a consistent decline across 2025; Q1: 1.468 million barrels per day, Q2: 1.481 million barrels per day, Q3: 1.444 million barrels per day, and 1.42 million barrels per day in Q4.
However, the cartel acknowledged that despite the gradual decrease in oil production, Nigeria’s non-oil sector grew in the second half of last year.
The organisation noted that “Nigeria’s economy showed resilience in 2H25, posting sound growth despite global challenges, as strength in the non-oil economy partly offset slower growth in the oil sector.”
According to the report, cooling inflation, a stronger Naira, lower refined fuel imports, and stronger remittance inflows are improving domestic and external conditions.
“A stronger naira, easing food prices due to the harvest, and a cooling in core inflation also point to gradually fading underlying pressures”, the report noted.
It forecast inflation to decelerate further on the back of past monetary tightening, currency strength, and seasonal harvest effects, though it noted that monetary policy remains restrictive.
“Seasonally adjusted real GDP growth at market prices moderated to stand at 3.9%, y-o-y, in 3Q25, down from 4.2% in 2Q25. Nonetheless, this is still a healthy and robust growth level, supported by strengthening non-oil activity, with growth in that segment rising by 0.3 percentage points to 3.9%, y-o-y. Inflation continued to decelerate in November, with headline CPI falling for an eighth straight month to 14.5%, y-o-y, following 16.1%, y-o-y, in October”.
OPEC, however, stated that while preserving recent disinflation gains is important, the persistently high policy rate – implying real interest rates of around 12% – risks weighing on aggregate demand in the near term.
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