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Block Moulders Begin Strike Over Cement, Granite Price Hike

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Block Moulders

Block moulders in the country on Monday commenced strike over the latest increase in the prices of cement, granite and other construction materials.

The moulders also hinted about plans to raise the prices of their products unless the prices of cement and other moulding materials were immediately reversed.

The President, National Association of Block moulders of Nigeria, Alhaji Rasco Adebowale, who confirmed the development to our correspondent, said the strike would last for five days.

This, he added, was to enable members of the association to adjust the prices of their products in line with the current situation.

He said, “We won’t really call it a strike but a break for one week after which we will decide on a new price for blocks following the increase in price of cement. As the price of cement has gone up, we are at a loss on how to sell blocks; so, we have called all our leaders in the six geo-political zones of the country to decide on the way forward.

“Starting from today, we will not work, sell or supply blocks to anywhere or anybody. This will enable us to work out how to sell our products throughout the federation. Cement is our major ingredient and we do not want to compromise on quality.”

The Cement Manufacturers Association of Nigeria last week raised prices of their various brands by N600 per bag as factory price and an additional N100 for the cost of haulage.

The increase in factory price was immediately followed by a hike by distributors and retailers to between N2,300 and N2,500, depending on the brand and location of the seller.

Prices of sand, granite, reinforcement rods and many other products for building construction have also been increased.

A popular block maker in Lagos, who spoke on condition of anonymity, said quarry products had risen by as much as 50 per cent and block moulders were at a loss on how to fix prices.

“The 50 per cent increase in the prices of cement and other quarry products such as granite and dust necessitated this. It is not an indefinite strike but we hope that the Federal Government as well as cement manufacturers will look into the issue,” the source added.

A 2nd Vice-President of the Nigerian Institute of Building, Mr. Kunle Awobodu, said the increase in price of cement had created uncertainties in the construction sector, adding that it had dampened the hope for affordable housing construction in the country.

Awobodu, who is also the President of Building Collapse Prevention Guild, said, with the rise in cement prices, “there will be the tendency to reduce the cement to sand ratio and the strength of the block will be weakened; this can lead to more cases of building collapse in the long run.

“So, there is a need for the association to agree on new price for blocks to avoid a proliferation of substandard products.”

A former Chairman, Nigerian Society of Engineers, Lagos State Chapter, Mr. Olatunde Jaiyesinmi, said the onus was on the government to put certain measures in place as the construction industry was already suffering low level of activities.

He said, “The announcement of any product price increase now should not be strange to anyone. There is hardly any product in the country that has no import component and our foreign reserve is shrinking by the day and until we decide on what we want to do with our appetite for foreign things, we still have a long way to go.

“The government is not giving good examples as regards this. Except we do something about the implementation of policies in the economy, we may not make any progress. The construction industry is the first casualty in any recession, it is the largest single sector that employs people, and this should be put into consideration.”

Is the CEO/Founder of Investors King Limited. A proven foreign exchange research analyst and a published author on Yahoo Finance, Businessinsider, Nasdaq, Entrepreneur.com, Investorplace, and many more. He has over two decades of experience in global financial markets.

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Crude Oil

Dangote Mega Refinery in Nigeria Seeks Millions of Barrels of US Crude Amid Output Challenges

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Dangote Refinery

The Dangote Mega Refinery, situated near Lagos, Nigeria, is embarking on an ambitious plan to procure millions of barrels of US crude over the next year.

The refinery, established by Aliko Dangote, Africa’s wealthiest individual, has issued a term tender for the purchase of 2 million barrels a month of West Texas Intermediate Midland crude for a duration of 12 months, commencing in July.

This development revealed through a document obtained by Bloomberg, represents a shift in strategy for the refinery, which has opted for US oil imports due to constraints in the availability and reliability of Nigerian crude.

Elitsa Georgieva, Executive Director at Citac, an energy consultancy specializing in the African downstream sector, emphasized the allure of US crude for Dangote’s refinery.

Georgieva highlighted the challenges associated with sourcing Nigerian crude, including insufficient supply, unreliability, and sometimes unavailability.

In contrast, US WTI offers reliability, availability, and competitive pricing, making it an attractive option for Dangote.

Nigeria’s struggles to meet its OPEC+ quota and sustain its crude production capacity have been ongoing for at least a year.

Despite an estimated production capacity of 2.6 million barrels a day, the country only managed to pump about 1.45 million barrels a day of crude and liquids in April.

Factors contributing to this decline include crude theft, aging oil pipelines, low investment, and divestments by oil majors operating in Nigeria.

To address the challenge of local supply for the Dangote refinery, Nigeria’s upstream regulators have proposed new draft rules compelling oil producers to prioritize selling crude to domestic refineries.

This regulatory move aims to ensure sufficient local supply to support the operations of the 650,000 barrel-a-day Dangote refinery.

Operating at about half capacity presently, the Dangote refinery has capitalized on the opportunity to secure cheaper US oil imports to fulfill up to a third of its feedstock requirements.

Since the beginning of the year, the refinery has been receiving monthly shipments of about 2 million barrels of WTI Midland from the United States.

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Oil Prices Hold Steady as U.S. Demand Signals Strengthening

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Crude Oil - Investors King

Oil prices maintained a steady stance in the global market as signals of strengthening demand in the United States provided support amidst ongoing geopolitical tensions.

Brent crude oil, against which Nigerian oil is priced, holds at $82.79 per barrel, a marginal increase of 4 cents or 0.05%.

Similarly, U.S. West Texas Intermediate (WTI) crude saw a slight uptick of 4 cents to $78.67 per barrel.

The stability in oil prices came in the wake of favorable data indicating a potential surge in demand from the U.S. market.

An analysis by MUFG analysts Ehsan Khoman and Soojin Kim pointed to a broader risk-on sentiment spurred by signs of receding inflationary pressures in the U.S., suggesting the possibility of a more accommodative monetary policy by the Federal Reserve.

This prospect could alleviate the strength of the dollar and render oil more affordable for holders of other currencies, consequently bolstering demand.

Despite a brief dip on Wednesday, when Brent crude touched an intra-day low of $81.05 per barrel, the commodity rebounded, indicating underlying market resilience.

This bounce-back was attributed to a notable decline in U.S. crude oil inventories, gasoline, and distillates.

The Energy Information Administration (EIA) reported a reduction of 2.5 million barrels in crude inventories to 457 million barrels for the week ending May 10, surpassing analysts’ consensus forecast of 543,000 barrels.

John Evans, an analyst at PVM, underscored the significance of increased refinery activity, which contributed to the decline in inventories and hinted at heightened demand.

This development sparked a turnaround in price dynamics, with earlier losses being nullified by a surge in buying activity that wiped out all declines.

Moreover, U.S. consumer price data for April revealed a less-than-expected increase, aligning with market expectations of a potential interest rate cut by the Federal Reserve in September.

The prospect of monetary easing further buoyed market sentiment, contributing to the stability of oil prices.

However, amidst these market dynamics, geopolitical tensions persisted in the Middle East, particularly between Israel and Palestinian factions. Israeli military operations in Gaza remained ongoing, with ceasefire negotiations reaching a stalemate mediated by Qatar and Egypt.

The situation underscored the potential for geopolitical flare-ups to impact oil market sentiment.

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Shell’s Bonga Field Hits Record High Production of 138,000 Barrels per Day in 2023

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oil field

Shell Nigeria Exploration and Production Company Limited (SNEPCo) has achieved a significant milestone as its Bonga field, Nigeria’s first deep-water development, hit a record high production of 138,000 barrels per day in 2023.

This represents a substantial increase when compared to 101,000 barrels per day produced in the previous year.

The improvement in production is attributed to various factors, including the drilling of new wells, reservoir optimization, enhanced facility management, and overall asset management strategies.

Elohor Aiboni, Managing Director of SNEPCo, expressed pride in Bonga’s performance, stating that the increased production underscores the commitment of the company’s staff and its continuous efforts to enhance production processes and maintenance.

Aiboni also acknowledged the support of the Nigerian National Petroleum Company Limited and SNEPCo’s co-venture partners, including TotalEnergies Nigeria Limited, Nigerian Agip Exploration, and Esso Exploration and Production Nigeria Limited.

The Bonga field, which commenced production in November 2005, operates through the Bonga Floating Production Storage and Offloading (FPSO) vessel, with a capacity of 225,000 barrels per day.

Located 120 kilometers offshore, the FPSO has been a key contributor to Nigeria’s oil production since its inception.

Last year, the Bonga FPSO reached a significant milestone by exporting its 1-billionth barrel of oil, further cementing its position as a vital asset in Nigeria’s oil and gas sector.

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