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Investment Banks Disagree on Oil Price Recovery in 2017

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Crude oil
  • Investment Banks Disagree on Oil Price Recovery in 2017

Global investment banks have differed on their forecasts on the recovery of crude oil prices in 2017, a recent survey on the projections of 12 banks has shown.

Crude prices dropped from a peak of $115 per barrel in June 2014 to a 13-year low of $27 per barrel in February in 2016.

The global benchmark Brent crude also traded at $57.89 per barrel on December 12, 2016 before dropping to its current average of $55.

But the result of the survey by wall Street Journal indicated that the 12 banks – Credit Suisse, BNP Paribas, ING, Commerzbank, Deutsche Bank, Societe Generale, Citigroup, JP Morgan, Barclays, RBC, Bank of America Merrill Lynch and Standard Chartered – all predicted a US crude price of around $45 per barrel and above in 2017.

However, three banks forecast that 2017 will end with crude oil selling at below $50 per barrel, while nine of the banks predicted that oil will close above $50 per barrel in 2017, with Standard Chartered making the highest forecast of about $68 per barrel for the fourth quarter of 2017.

In the first quarter of 2017, half of the banks forecast prices below $50 per barrel, while the remaining six saw oil selling above $50 per barrel, according to the December 2016 survey conducted by the Wall Street Journal Market Data Group.

Three banks – Deutsche Bank, Barclays and Bank of America Merrill Lynch – saw oil averaging $55 in the first quarter.

The survey showed that in the second quarter, five of the banks predicted below $50 per barrel for the price of oil, with ING and JP Morgan making the lowest forecasts of $45 per barrel.

Seven of the banks predicted oil prices above $50 per barrel in the second quarter, with Standard Chartered making the highest forecast of around $63, followed by Barclays’ average of $60 per barrel.

JP Morgan and ING saw US crude price settling around $45 in the second quarter 2017, according to the survey.

In the third quarter, only three banks – ING, Commerzbank and JP Morgan – predicted below $50 per barrel for the price of oil, with forecasts hovering around $45, $48 and $45, respectively.

The other nine banks predicted an oil price of above $50 per barrel in the third quarter, with Standard Chartered giving the highest forecast of close to $65 per barrel, followed by Deutsche Bank and Bank of America, both of which predicted an average of $64.

Four banks – RBC, Barclays, Societe Generale and BNP Paribas – saw the price of US crude settling around $55 in the third quarter.

In the fourth quarter of 2017, ING, Commerzbank and JP Morgan still believed that oil price would remain around $45 per barrel.

However, Standard Chartered predicted the highest recovery of oil at about $68 per barrel in the fourth quarter of 2017, followed by Citigroup and Bank of America, which predicted around $62 and $61, respectively.

Credit Suisse and Societe Generale both saw oil prices around $60 per barrel in the fourth quarter, while RBC and BNP Paribas forecast $58 and $55 per barrel for oil, respectively.

CEO/Founder Investors King Ltd, a foreign exchange research analyst, contributing author on New York-based Talk Markets and Investing.com, with over a decade experience in the global financial markets.

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Naira

Naira Falls to N500/US$1 at Black Market on Monday

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Naira - Investors King

Despite efforts by the Central Bank of Nigeria (CBN) to improve dollar liquidity across the foreign exchange segments and prop up Naira value, the Nigerian Naira dipped to N500 against the United States Dollar on Monday at the nation’s black market.

Last week, the CBN announced plans to increase forex allocation to Deposit Money Banks in a bid to ensure Nigerians access forex at a fair rate and not forced to patronise the black market operators with exuberant rates.

The CBN agreed to increase the amount allocated to banks for travellers, Small and Medium Enterprises among others. The banks also agreed to operate something akin to foreign exchange imprest account such that the coffers of banks will be replenished so long as they retire the initial amounts to the satisfaction of the CBN”, stated Mr. Osita Nwanisobi, the Acting Director, Corporate Communications Department at the CBN.

The Naira quickly gained against its global counterparts, improving to N493 against the American Dollar last week before resuming its long-term bearish trend to N500/US$1 at the black market on Monday 21, June 2021.

The embattled currency depreciated in value against both the Euro and British Pound, exchanged at N590 and N710, respectively.

At the NAFEX window, the CBN new adopted official rate, the Naira traded at N411.67 to a United States Dollar on Monday while investors transacted $94.17 million during the trading hours of Monday.

At the Bureau De Exchange section of forex, Naira sold for N495 per US Dollar, N715 to a British Pound and N603 to a Euro.

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Naira

Nigerian Naira Exchange Rates; Tuesday, June 22, 2021

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Naira - Investors King

 The Nigerian Naira lost N2 against the United States Dollar on Monday to N500 despite efforts by the Central Bank of Nigeria to prop the local currency value.

The embattled currency remained pressured at N710 to a British Pound and N590 to a single Euro.  Naira opened at N500 to a United States Dollar on Tuesday.

Naira Black Market Exchange Rates

Morning * Midday** Evening *** Final Rates

Date USD GBP EURO YUAN Canadian Australian
NGN BUY/SELL BUY/SELL BUY/SELL BUY/SELL BUY/SELL BUY/SELL
22/06/2021 495/500* 703/710* 585/590* 62/69 400/410 300/322
21/06/2021 495/500 703/710 585/592 62/69 400/410 300/325
18/06/2021 492/498 700/710 585/595 62/69 400/410 300/325
17/06/2021 483/493 700/710 590/600 62/69 400/410 300/322
16/06/2021 497/502 707/713 600/606 62/69 400/410 300/322

Bureau De Change Naira Rates

Date USD GBP EURO
NGN BUY/SELL BUY/SELL BUY/SELL
22/06/2021 485/495 700/715 580/603
21/06/2021 480/490 680/710 550/603
19/06/2021 475/490 680/715 580/603
18/06/2021 475/485 680/715 580/603
17/06/2021 478/490 690/710 590/603
16/06/2021 495/500 707/718 600/609
15/06/2021 495/500 707/718 600/609
14/06/2021 490/498 705/718 600/608

Central Bank of Nigeria’s Official Naira Rates

Date Currency Buying(NGN) Central(NGN) Selling(NGN)
6/21/2021 US DOLLAR 409.2 409.7 410.2
6/21/2021 POUNDS STERLING 567.6422 568.3358 569.0294
6/21/2021 EURO 486.5797 487.1743 487.7688
6/21/2021 SWISS FRANC 444.0586 444.6012 445.1438
6/21/2021 YEN 3.7166 3.7212 3.7257
6/21/2021 CFA 0.7231 0.7331 0.7431
6/21/2021 WAUA 583.9237 584.6372 585.3507
6/21/2021 YUAN/RENMINBI 63.2634 63.3412 63.4189
6/21/2021 RIYAL 109.1113 109.2446 109.3779
6/21/2021 SOUTH AFRICAN RAND 28.7174 28.7525 28.7876

 

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Naira

Naira Exchange Rates; Monday, June 21, 2021

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Naira Dollar Exchange Rate - Investors King

The Nigerian Naira continues its decline against global counterparts after gaining on the back of the Central Bank of Nigeria’s proposed increase in foreign exchange supply to all forex operators across the country.

Naira gained on the parallel market to exchange at N493 against the United States Dollar on Tuesday 15, June 2021 before dropping to N497 on Wednesday 16, June 2021.

The local currency plunged as low as N502 to a United States Dollar on the parallel market before the CBN announced its plans to up liquidity in an effort to ease scarcity and speed up business activities in the largely import-dependent economy. See the Naira exchange rates across various sections of foreign exchange markets.

Naira Black Market Exchange Rates

Morning * Midday** Evening *** Final Rates

Date USD GBP EURO YUAN Canadian Australian
NGN BUY/SELL BUY/SELL BUY/SELL BUY/SELL BUY/SELL BUY/SELL
21/06/2021 495/500 703/710 585/592 62/69 400/410 300/325
18/06/2021 492/498 700/710 585/595 62/69 400/410 300/325
17/06/2021 483/493 700/710 590/600 62/69 400/410 300/322
16/06/2021 497/502 707/713 600/606 62/69 400/410 300/322

Bureau De Change Naira Rates

Date USD GBP EURO
NGN BUY/SELL BUY/SELL BUY/SELL
21/06/2021 480/90 680/710 550/603
19/06/2021 475/490 680/715 580/603
18/06/2021 475/485 680/715 580/603
17/06/2021 478/490 690/710 590/603
16/06/2021 495/500 707/718 600/609
15/06/2021 495/500 707/718 600/609
14/06/2021 490/498 705/718 600/608

Central Bank of Nigeria’s Official Naira Rates

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