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Banks Begin Compliance with Directive on FX Teller Points

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  • Banks Begin Compliance with Directive on FX Teller Points

Some commercial banks have heeded the Central Bank of Nigeria’s (CBN) directive on the opening of teller points for retail foreign exchange transactions, investigation has shown.

The CBN had said the new directive was a reaffirmation of its willingness, capability and determination to meet FX demand in the market.

Some of the commercial banks branches visited in Abuja yesterday to assess the level of compliance with the directive had already created special points for FX transactions as well as electronic display boards to show current FX rates.

However, officials of some banks’ branches visited around the Asokoro area of Abuja expressed ignorance of the central bank’s new directive.

When asked if his bank had complied with the new directive, a senior official in one of the second generation banks said his branch was not aware of the directive.

He said it was the headquarters of the bank that should preoccupy itself with handling such directives, adding that the directive he was familiar with was the one mandating commercial banks to create FX sales points at airports to attend to travellers’ FX needs.

He, alongside a female colleague, said the banks needed some time to comply with the latest directive.

In issuing the new directive, the CBN said the initiative was aimed at easing access to buying and selling of FX at all locations as well as easing access by customers and other users, without any hindrance.

The CBN on Sunday also directed all commercial banks to process and meet the demand for travel allowances (PTA/BTA) by end-users within 24 hours of such applications.

Investigation showed that although some of the banks within the Federal Capital Territory (FCT) had electronic monitors for FX rates, they posted insufficient information on rates.

For instance, while some of them displayed only their selling rates without the buying rate, others showed the rate at which they were buying but not selling.

Investigation further revealed that most of the banking halls visited had only a few customers conducting FX transactions.

In a related development, the central bank yesterday sustained its intervention in the FX market, when it provided another $367,134,329.93 in forwards sales.

A breakdown showed that $144,073,753.07 was for 45 days forwards, while $223,060,576.86 was for 60 days.

However, the naira traded between N455 and 460 to the dollar at some parallel market points in Lagos.

The CBN acting Director in charge of Corporate Communications, Isaac Okorafor, confirmed the release, adding that the move was in line with the Bank’s determination to ease the FX pressure on various sectors through forward sales under the new flexible regime to keep the market liquid.

The CBN recently introduced new FX measures, which among other things, are aimed at easing the burden of travellers and to ensure that transactions are settled at much more competitive exchange rates.

The central bank had also directed all commercial and deposit banks to open FX retail outlets at major airports as soon as logistics permit.

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

Oil Prices Continue to Slide: Drops Over 1% Amid Surging U.S. Stockpiles

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Crude Oil

Amidst growing concerns over surging U.S. stockpiles and indications of static output policies from major oil-producing nations, oil prices declined for a second consecutive day by 1% on Wednesday.

Brent crude oil, against which the Nigerian oil price is measured, shed 97 cents or 1.12% to $85.28 per barrel.

Similarly, U.S. West Texas Intermediate (WTI) crude slumped by 93 cents or a 1.14% fall to close at $80.69.

The recent downtrend in oil prices comes after they reached their highest level since October last week.

However, ongoing concerns regarding burgeoning U.S. crude inventories and uncertainties surrounding potential inaction by the OPEC+ group in their forthcoming technical meeting have exacerbated the downward momentum.

Market analysts attribute the decline to expectations of minimal adjustments to oil output policies by the Organization of the Petroleum Exporting Countries (OPEC) and its allies, known collectively as OPEC+, until a full ministerial meeting scheduled for June.

In addition to concerns about excess supply, the market’s attention is also focused on the impending release of official government data on U.S. crude inventories, scheduled for Wednesday at 10:30 a.m. EDT (1430 GMT).

Analysts are keenly observing OPEC members for any signals of deviation from their production quotas, suggesting further volatility may lie ahead in the oil market.

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Energy

Nigeria Targets $5bn Investments in Oil and Gas Sector, Says Government

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Crude Oil - Investors King

Nigeria is setting its sights on attracting $5 billion worth of investments in its oil and gas sector, according to statements made by government officials during an oil and gas sector retreat in Abuja.

During the retreat organized by the Federal Ministry of Petroleum Resources, Minister of State for Petroleum Resources (Oil), Heineken Lokpobiri, explained the importance of ramping up crude oil production and creating an environment conducive to attracting investments.

He highlighted the need to work closely with agencies like the Nigerian National Petroleum Company Limited (NNPCL) to achieve these goals.

Lokpobiri acknowledged the challenges posed by issues such as insecurity and pipeline vandalism but expressed confidence in the government’s ability to tackle them effectively.

He stressed the necessity of a globally competitive regulatory framework to encourage investment in the sector.

The minister’s remarks were echoed by Mele Kyari, the Group Chief Executive Officer of NNPCL, who spoke at the 2024 Strategic Women in Energy, Oil, and Gas Leadership Summit.

Kyari stressed the critical role of energy in driving economic growth and development and explained that Nigeria still faces challenges in providing stable electricity to its citizens.

Kyari outlined NNPCL’s vision for the future, which includes increasing crude oil production, expanding refining capacity, and growing the company’s retail network.

He highlighted the importance of leveraging Nigeria’s vast gas resources and optimizing dividend payouts to shareholders.

Overall, the government’s commitment to attracting $5 billion in investments reflects its determination to revitalize the oil and gas sector and drive economic growth in Nigeria.

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Commodities

Palm Oil Rebounds on Upbeat Malaysian Exports Amid Indonesian Supply Concerns

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Palm Oil - Investors King

Palm oil prices rebounded from a two-day decline on reports that Malaysian exports will be robust this month despite concerns over potential supply disruptions from Indonesia, the world’s largest palm oil exporter.

The market saw a significant surge as Malaysian export figures for the current month painted a promising picture.

Senior trader David Ng from IcebergX Sdn. in Kuala Lumpur attributed the morning’s gains to Malaysia’s strong export performance, with shipments climbing by a notable 14% during March 1-25 compared to the previous month.

Increased demand from key regions like Africa, India, and the Middle East contributed to this impressive growth, as reported by Intertek Testing Services.

However, amidst this positivity, investors are closely monitoring developments in Indonesia. The Indonesian government’s contemplation of revising its domestic market obligation policy, potentially linking it to production rather than exports, has stirred market concerns.

Edy Priyono, a deputy at the presidential staff office in Jakarta, indicated that this proposed shift aims to mitigate vulnerability to fluctuations in export demand.

Yet, it could potentially constrain supply availability from Indonesia in the future to stabilize domestic prices.

This uncertainty surrounding Indonesian policies has added a layer of complexity to palm oil market dynamics, prompting investors to react cautiously despite Malaysia’s promising export performance.

The prospect of Indonesian supply disruptions underscores the delicacy of global palm oil supply chains and their susceptibility to geopolitical and regulatory factors.

As the market navigates these developments, stakeholders remain attentive to both export data from Malaysia and policy shifts in Indonesia, recognizing their significant impact on palm oil prices and market stability.

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