Finance

Nigeria’s Brent crude crosses $72 mark, production hits 1.81mbpd

Published

5 years ago

April 17, 2018

Nigeria’s Brent crude crosses $72 mark, production hits 1.81mbpd

Nigeria’s Bonny Light crude oil price touched it’s highest since 2014 at the weekend, supported by Organisation of the Petroleum Exporting Countries (OPEC) led production cuts, and the likelihood of the United States taking military action in Syria increases.

Besides, Nigeria’s crude oil production increased from 1.792mbpd in February to 1.810 mbpd in March.OPEC and allies including Russia are keeping crude oil supply limits in place in 2018, to reduce a price-denting glut of oil held in inventories.

Also, the United State pledged recently that missiles would be fired at Syria and this is said to have threatened crude oil supply level thereby leading to higher oil prices.

Nigeria’s Bonny Light attained its highest level at $72.73 a barrel, a little lower than Brent crude oil, which sold for $72.58 per barrels during the trading hours on Friday.

Bonny Light oil is a high grade of Nigerian crude oil produced in the Niger Delta basin and named after the prolific region around the city of Bonny.

The very low sulfur content of Bonny Light crude makes it a highly desired grade for its low corrosiveness to refinery infrastructure and the lower environmental impact of its byproducts in refinery effluent.

The United States West Texas Intermediate (WTI) crude oil also hits $67.39 per barrel at the weekend.In March, the OPEC Reference Basket (ORB) increased by less than 0.5 percent to $63.76 per barrel.

Oil futures ended about one percent higher in a relatively volatile month, following US equity market movements and supported by robust oil demand growth forecasts, tightening US crude stocks and geopolitical tensions.

For the month, the Dubai structure flipped back into contango, while Brent and WTI structure remained in backwardation, albeit at a reduced level before the latest price surge.

OPEC crude oil production dropped by over 201,000 barrels per day in March over the previous months, while production mainly decreased in Angola, Venezuela, Algeria and Saudi Arabia.

This OPEC said has been partially offset by higher production in the United Arab Emirates, according to the organization’s latest crude oil report.

OPEC expects the demand for its crude oil to be at 32.6 million barrels per day (bpd), 0.3 mbpd lower than in 2017.

Speaking recently on the efforts of OPEC toward price stability, OPEC Secretary General, Mohammad Sanusi Barkindo said that the global energy system is undergoing significant and speedy changes and becoming progressively complex.

He stated: “Our economies are increasingly interwoven. We must build on our common ground to face upcoming challenges together, strive for sustainable market stability and safeguard future energy security through our ongoing effective cooperation.

The irreversible forces of globalization will continue to shape this energy transition.

“We have, through the Declaration of Cooperation, which has become a permanent feature on the global energy scene, established a new framework for producing countries, taking into account the strategic interests of consumer countries as well as the world economy.”

Minister of Petroleum Resources, Dr. Ibe Kachikwu urged OPEC countries to work hard and become least-cost oil producer, saying that if shale oil can produce and sell at $65 per barrel, there was absolutely no reason why Nigeria and other OPEC members’ country should be struggling.

He said: “Shale is going to active. We know that whenever we are in excess of $65 per barrel, shale gets very active because the fundamentals become much more supportive of more investments and more production lines.”

Finance

AfDB Secures $15.6bn for Lagos-Abidjan Highway Corridor

Published

2 years ago

March 18, 2022

Onyebuchi Aniekeyi

AfDB Secures $15.6bn for Lagos-Abidjan Highway Corridor

Author: Eunice Johnson, Abuja

President of the African Development bank, Dr. Akinwumi Adesina, has announced that the bank has secured 15.6bn dollars for the construction of the Lagos-Abidjan highway corridor, which would ease transportation across West Africa.

Adesina made this announcement during the 2021 Africa Investment Forum’s virtual boardroom closing session on Thursday.

The AFDB President said the 15.6bn dollar deal which is the biggest deal for the boardroom is a 46-lane highway corridor which will connect Lagos, Cotonou, Lome, Accra and Abidjan.

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According to him, the project would support trade in West Africa, impacting the lives of over 500 million people, reducing transport costs and increasing intra-regional trade volume.

The bank will also be establishing a 1m dollars AFAWA women advisory facility to support women with advisory services.

Finance

Nigeria Borrowed N6.64tn, Serviced Debt with N2.93tn in 2021 – DMO

Published

2 years ago

March 18, 2022

Onyebuchi Aniekeyi

Author: Gift Wada, Abuja

THE Debt Management Office on Thursday said Nigeria’s total public debt stock increased to N39.56tn in 2021 from N32.92tn in 2020.
The Director-General, DMO, Patience Oniha, said this at a media briefing in Abuja.
According to her, the total debt includes new borrowings by the Federal Government and the sub-nationals.
She also said that the amount helped in financing the budget deficit, capital projects and support economic recovery.
Oniha said, “Nigeria’s total public debt as at December 31, 2021, was N39.56tn or $95.78bn. The amount represents the total external and domestic debts of the Federal Government of Nigeria, 36 state governments and the federal capital territory.
“The comparable figure for December 31, 2020, was N32.92tn or $86.39bn. The public debt stock for December 31, 2021, includes new borrowings by the FGN and the sub-nationals. For the FGN, it would be recalled that the 2021 appropriation and supplementary acts, included total new borrowings (from domestic and external sources) of N5.49tn to part-finance the deficit.
“Borrowings for this purpose and disbursements by the multilateral and bilateral creditors account for a significant portion of the increase in the debt stock. Increases were also recorded in the debt stock of the states and the FCT.”
She further said that despite the debt increase, the country is still within the total public debt stock to the Gross Domestic Product limit of 55 per cent set by the World Bank and 70 per cent set by the Economic Community of West African States.
Oniha also said that the Federal Government was “mindful of the relatively high debt-to-revenue ratio” and has established certain measures to increase revenues through the strategic revenue growth initiative and the introduction of Finance Acts since 2019.
She said, “The new borrowings were raised from diverse sources, primarily through the issuances of the Eurobonds, sovereign Sukuk, and the FGN bonds. These capital raisings were utilised to finance capital projects and support economic recovery.

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“With the total public debt stock to GDP as at December 31, 2021, of 22.47 per cent, the debt-to-GDP ratio still remains within Nigeria’s self-imposed limit of 40 per cent. This ratio is prudent when compared to the 55 per cent limit advised by the World Bank and the International Monetary Fund for countries in Nigeria’s peer group, as well as, the ECOWAS convergence ratio of 70 per cent.”
However, findings showed that Nigeria spent N2.93tn on debt servicing payments in 2021, according to the data obtained from the DMO.
Between January and March 2021, Nigeria spent N612.71bn on domestic debt servicing, while it spent $1bn (N415.92bn) on external debt servicing, giving a total of N1.03tn.
From April to June 2021, the country spent N322.7bn on domestic debt servicing and $299m (N124.36bn) on external debt servicing, showing a total of N447.06bn.
From July to September 2021, Nigeria spent N808.49bn on domestic debt servicing and $520.78m (N216.6bn) on external debt servicing, giving a total of N1.03tn.
Between October and December 2021, Nigeria spent N310.5bn on domestic debt servicing, while it spent $286.35m (N119.1bn) on external debt servicing, giving a total of N429.6bn.
The official exchange rate of the Central Bank of Nigeria, which showed $1 =N415.92 as of March 17, was used for the external debt servicing.

Finance

Nigeria Emerges First in Africa to Access ICM, Raises $1.25bn Eurobonds

Published

2 years ago

March 18, 2022

Gift Wada

Nigeria Emerges First in Africa to Access ICM, Raises $1.25bn Eurobonds

Nigeria has officially raised 1.25 Billion dollars through the issuance of a seven-year Eurobonds in the International Capital Market (ICM).
The Director-General of the Debt Management Office (DMO), Patience Oniha made this known in a statement on Thursday.

Oniha said that with this feat, Nigeria has become the first African country to access the ICM in 2022.

According to her, the country’s ability to access the Eurobonds at this time was a confirmation of her established presence with the ICM and engagement with investors on a continuous basis.
She said that the proceeds of the bonds would be used to finance the budget and bridge infrastructural deficits.
“The offer was launched at an initial price thought of 8.75 per cent per annum and on the back of strong investor demand, Nigeria was able to reverse the price guidance to 8.5 per cent per annum.

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“The order book continued to grow, reaching a peak of four billion dollars,” she said.
She said that the order book included many quality investors in the U.S., Europe and Asia.

“With this strong investor interest the price was tightened at 8.37 per cent per annum, the order book still remained high at 3.67 billion dollars and still retained quality investors,” she said.
She said that Nigerian investors also participated in the offer with a total subscription of 60 million dollars.

She added that the Eurobonds would also strengthen economic recovery and contribute directly and in full to the level of Nigeria’s External Reserves.
Reports Show that the DMO had earlier on Thursday revealed that Nigeria ’s ’total debt stock as at December 2021 was N39.55 trillion.