- Oil Prices Rise, Interbank Rate Jumps
Oil futures climbed on Friday as signs of the market tightening after major oil producers agreed to cut output helped set prices up for a modest gain on the week.
The nation’s interbank lending rate also rose to close at 11.5 per cent on Friday, up from seven per cent the previous week as payments for bond and treasury bills purchases drained liquidity from the money market.
On the New York Mercantile Exchange, February West Texas Intermediate crude CLG7, +1.99 per cent jumped $1.47, or 2.9 per cent, to $52.84 a barrel. The contract, which expires at the day’s settlement, finished last Friday at $52.37; so it was trading around 0.9 per cent higher for the week, according to FactSet data.
The report said March Brent crude LCOH7, +2.42% on London’s ICE Futures exchange advanced by $1.54, or 2.8 per cent, to $55.7- a barrel—up around 0.5 per cent for the week.
Saudi Arabia’s Energy Minister Khalid al-Falih, speaking at the World Economic Forum in Davos last week, reportedly said that there had been strong compliance among members and non-members of the Organisation of the Petroleum Exporting Countries to the production cut agreement that kicked in at the start of the year.
News reports also quoted him as saying on Friday that 1.5 million barrels a day of the roughly 1.8 million in cuts pledged by OPEC and non-OPEC countries had already been taken out of the market.
Al-Falih also warned that there could be a shortage of oil supply by 2020 if investment flows continued at their current rate, according to the CNBC.
Comments from Saudi Arabia regarding progress on the output cuts “is giving the market some increased confidence that cheating will be limited and markets will continue to rebalance,” a senior energy analyst at Edward Jones, Brian Youngberg, told MarketWatch.
A committee created to monitor oil-producer compliance with the promised cuts was scheduled to meet at the weekend, the report added
“Since there are mixed expectations on how much of the cuts will come to fruition, any comments one way or the other will sway markets any particular day,” said Youngberg.
In a monthly report issued last week, the International Energy Agency said OPEC production had slowed, declining by 320,000 barrels a day to 33.09 million barrels in December.
“Early indications suggest a deeper OPEC reduction may be under way for January, as Saudi Arabia and its neighbors enforce supply cuts,” the IEA said.
Meanwhile, traders said the lending rate jumped on Friday as some banks scrambled for cash to pay for bonds and treasury bills, Reuters reported.
The Federal Government had on Wednesday raised N214.95bn ($704m) from local currency bonds at its first auction this year, with payment for the bonds due on Friday.
The naira weakened slightly at the open or unofficial market to 498 to the dollar against 497 previously as inadequate greenback supply pressured the local currency.
The local currency, however closed flat at the official interbank window at 305.50 to the dollar, the level it has traded at since August last year.
Travelex, an international money transfer firm, sold around $20m to 2,500 Bureaux de Change operators on Thursday at $8,000 each, but the supply was not enough to calm the market, traders said.
The BDCs quoted their official selling rate at 399 to the dollar on Friday.
The government has been pressing retail operators to narrow what it says is a damaging gulf between the naira’s official rate and the unapproved open retail market.
“We see the interbank rate drop below the double-digit next week on anticipation of budgetary disbursal to government agencies,” one trader said.
Traders said the local currency might firm a bit as international money transfer agents planned to sell another round of dollars to the bureau de change operators next Thursday.
Egypt Leads Nigeria, South Africa in Foreign Direct Investment
The United Nations Trade Association has Nigeria recorded a total of $2.6 billion in Foreign Direct Investment (FDI) in 2020, below the $3.3 billion posted in the preceeding year.
South Africa, Africa’s most industrialised nation, reported $2.5 billion during the same year, slightly below Africa’s largest economy and 50 percent below the $4.6 billion attracted a year earlier.
The report also noted that Africa recorded a total of $38 billion FDI in the same year, representing a 18 percent decline from the $46 billion posted in the corresponding year of 2019.
However, Egypt led Nigeria and South Africa with $5.5 billion FDI, an increase of 38 percent from the preceeding year.
The report read in part, “FDI flows to Africa declined by 18% to an estimated $38 billion, from $46 billion in 2019. Greenfield project announcements, an indication of future FDI trends, fell 63% to $28 billion, from $77 billion in 2019. The pandemic’s negative impact on FDI was amplified by low prices of and low demand for commodities.”
UNCTAD also noted that global foreign direct investment declined by 42 percent to an estimated $859 billion, down from $1.5 trillion in 2019.
“The decline was concentrated in developed countries, where FDI flows fell by 69 percent to an estimated $229 billion. Flows to Europe dried up completely to -4 billion (including large negative flows in several countries). A sharp decrease was also recorded in the United States (-49%) to $134 billion.”
FG to Partly Fund Six Rail Projects Connecting All Regions
The Federal Government will pay a total sum of N71 billion to partly fund six rail projects connecting all regions of the country.
In the report obtained from the Federal Ministry of Finance, Budget and National Planning, the six rail projects marked for development this year are Lagos-Kano rail line (ongoing), Calabar-Lagos (ongoing), and Ajaokuta-Itakpe-Aladja (Warri).
Others are the Port Harcourt-Maiduguri railway, the new Kano-Katsina-Jibiya-Maradi line in Niger Republic and the Abuja-Itakpe and Aladja-Warri Port and refinery/Warri new harbour.
The Buhari administration will also spend N15.1 billion on the development of safety and security of critical projects, airport certification, runway construction, terminal building, among others in the aviation sector in 2021.
Last week, Rotimi Amaechi, Minister of Transportation, said the Lagos-Kano line would be connected from the Ibadan end of the Lagos-Ibadan railway and would cost $5.3 billion.
“We are waiting for the Chinese government and bank to approve the $5.3bn to construct the Ibadan-Kano. What was approved a year ago was the contract,” the minister said.
He added, “The moment I announced that the Federal Government had awarded a contract of $5.3bn to CCECC (China Civil Engineering and Construction Corporation) to construct Ibadan-Kano, people assumed the money had come in; no.
“We have not got the money, which is a year after we applied for the loan. We have almost finished the one of Lagos-Ibadan. If we don’t get the loan now, we can’t commence.”
FG Launches E-ticketing Platform to Deepen Train Usage and Convenience
In a bid to improve the usage and enhance the convenience of train transport in Nigeria, the Federal Government on Thursday announced the launching of the Electronic Ticketing platform for the Kaduna-Abuja rail services.
The N900 million E-ticketing platform was introduced by the Minister of Transportation, Chibuike R. Amaechi, and the Nigerian Railway Corporation.
Amaechi said the new platform would improve efficiency, promote accountability, reduce leakage and enhance economic growth, as well as save time.
The E-ticketing platform was a Public-Private Partnership project done in conjunction with Secure ID Solutions, who provide and would manage the system for 10 years in an effort to recoup its investment before the Nigerian Railway Corporation take charge.
Kofo Akinkugbe, the Chief Executive Officer, Secure ID Solutions, said as the new E-platform issued 25,000 tickets after a successful pilot test on Thursday.
Potential Travelers can book via three ways:
1. Mobile app
3. POS or Cash at the station
A validator would be used to scan the ticket barcode to ascertain its authenticity before boarding.
Amaechi further announced that self-service ticket vending machines at various train stations would be introduced soon.
Vitafoam Expands Net Asset per share by 54.3 Percent in 2020
Fixed Income N5 Trillion Maturing Security to Sustain Nigerian Stock Exchange
COVID-19 Plunges Nigeria’s Oil Revenue by 41% in the First Nine Months of 2020
News3 weeks ago
Heartbroken American Mistress Displays Dangote’s Buttocks in a Viral Video
Crude Oil4 weeks ago
Crude Oil Rose to Almost $52 Per Barrel After Trump Signs Stimulus Package
News3 weeks ago
FCMB Group MD Links to Death of Tunde Thomas, Husband of Married Staff He Fathered Her Kids
Investment2 weeks ago
London Real Estate Company for African Investors Announces its Launch
Finance3 weeks ago
President Buhari Increases Npower Budget by N365 Billion
Technology4 weeks ago
Chinese Government Goes After Jack Ma and Empire
News3 weeks ago
Tunde Thomas: FCMB Commences Review Into Allegations of Unethical Behavior Against MD Nuru
Brands4 weeks ago
Prada’s Profits Drop by $219 Million, Sales in China Up by 60%