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NNPC Massively Stockpiles PMS to Sustain Price Crash

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petrol
  • NNPC Massively Stockpiles PMS to Sustain Price Crash

A daily record of operations of the Nigerian National Petroleum Corporation (NNPC) has disclosed the corporation’s plans to sustain the petrol pump price crash it started last week with a healthy build-up of stocks.

Obtained on saturday, the records from both the Petroleum Products Pricing Regulatory Agency (PPPRA) and NNPC’s Crude Oil Marketing Department (COMD), indicated that, currently, the corporation had accumulated 1.640 billion litres of petrol, enough to last the country up to 46 days of petrol consumption.

In addition to the existing stock level, the records also showed that 1.125.2 billion litres of petrol were being expected for delivery to the corporation between September 5 and 30, 2017, thus suggesting the country would have an additional 32-day product sufficiency going by its current 35 million litres daily consumption rate.

Last week, the NNPC disclosed its strategic intervention in the downstream petroleum sector of the country had resulted to some drop in the prices of petrol and Liquefied Petroleum Gas (LPG), also known as cooking gas, nationwide.

According to a statement signed by its Group General Manager, Public Affairs, Mr. Ndu Ughamadu, pump price of petrol had dropped from N145 to between N143 and N142 per litre across the country, while the ex-depot price dropped from N138 to N133.28 at its depot.

However, a high-ranking official of NNPC said the price crash was occasioned by its large product stockpile, and a decision to continue to offload products to make way for those that are incoming.

The official, who craved anonymity, stated that NNPC was augmenting its importation of petrol with supplies from its refineries, majorly Port Harcourt refinery, which the records said produced about 2.127 million litres of petrol on September 5.

He noted that, the efforts would be sustained going into the yuletide season when Nigerians usually have challenges of stable petrol supplies.

Notwithstanding, the daily operational records stated that the corporation had steadily taken delivery of petrol and on September 5, received 145.1 million litres of petrol. It similarly had a total of 333,072.827 metric tons (mt) of petrol delivered into the country between August 20 and 31, 2017.

As regards petrol distribution, the records showed that 775 trucks distributed the product to states in the country on September 5, with 208 trucks sent to states in the North-central; 219 to the North-east; 225 to the North-west; 19 trucks to the South-south; and 104 trucks to the South-west.

Meanwhile, the records equally stated that the prices of Nigeria’s crude oil blends at the international market maintained healthy trends within the periods of September 4, with the lowest staying at $52.785 per barrels.

According to the document, the Bonny Light, Qua Iboe Light, and Forcados Blend traded for $52.785; $53.285; and $53.335 per barrels respectively, representing an increase of $0.440 from the prices of the previous day.

While Nigeria’s crude blends have maintained healthy price levels, Venezuela has again called for her and Libya to come under the oil production cap agreement reached between member countries of the Organisation of Petroleum Exporting Countries (OPEC) and non-OPEC countries led by the Russian Federation.

According to oilprice.com, Venezuela’s oil minister, Eulogio Del Pino, told reporters at an energy conference in Kazakhstan that oil inventories were still roughly 300 million barrels higher than normal levels. Del Pino suggested that the two African countries with exemptions from the production cap agreement should be put under quotas as well.

“Those 300 million barrels are going to impact speculation in the market. It (the level of inventories) is still very high,” Pino said, while disclosing that meetings with ministers from the Middle East and Russia on this had been planned for the near future.

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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Economy

Nigeria’s Plan to Review Oil Companies’ Gas Flaring Strategies

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Oil

Nigeria is ramping up its efforts to address environmental concerns in the oil and gas sector with a comprehensive plan to review gas flaring strategies of international and indigenous oil companies.

The Minister of State for Environment, Dr. Iziaq Salako, announced this initiative during a national stakeholders engagement meeting on methane mitigation and reduction held in Abuja, Investors King reports.

Gas flaring, a common practice in the oil industry, releases methane—a potent greenhouse gas—into the atmosphere, contributing to climate change and posing health risks to communities near oil facilities.

Nigeria aims to end routine gas flaring by 2030, aligning with global climate goals and commitments.

Dr. Salako explained the importance of reducing methane emissions and highlighted the detrimental effects on public health, food security, and economic development.

He outlined practical steps being taken to tackle methane emissions, including the development of methane guidelines and the engagement of government institutions.

The ministry, through the National Oil Spill Detection and Response Agency, will conduct periodic reviews of oil companies’ plans to ensure compliance with the gas flaring deadline.

Deloitte management consultants will assist in conducting comprehensive forensic audits to scrutinize the legitimacy of forward-contracted transactions.

President Bola Tinubu’s commitment to environmental sustainability underscores the government’s dedication to addressing climate change and fulfilling its multilateral environmental agreements.

The engagement event served as a platform for stakeholders to discuss methane mitigation strategies, existing policies, and implementation challenges.

Collaboration and dialogue among diverse sectors are crucial in charting a unified course towards sustainable methane reduction in Nigeria’s oil and gas industry.

As the country navigates its environmental agenda, ensuring accountability and transparency in gas flaring practices remains paramount for achieving a greener and healthier future.

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Economy

Interest Rate Jumps to 24.75% as CBN Takes Aggressive Stance Against Inflation

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Dr. Olayemi Michael Cardoso

The Central Bank of Nigeria (CBN) has announced a significant increase in the monetary policy rate, known as the interest rate, to 24.75%.

This move disclosed by CBN Governor Olayemi Cardoso during the 294th Meeting of the Monetary Policy Committee press briefing in Abuja, represents a bold step by the apex bank to address the mounting inflationary pressures faced by the country.

With inflation soaring to 31.70% in February, the CBN aims to moderate this upward trend by tightening its monetary policy stance.

This decision follows the previous hike in the interest rate to 22.75% in February, showcasing the CBN’s commitment to combatting inflationary forces.

While the bank opted to maintain the Cash Reserve Ratio at 45%, the significant increase in the interest rate underscores the urgency of the situation and the need for decisive action.

Governor Cardoso emphasized that these measures are essential to stabilize the economy and safeguard the purchasing power of the Nigerian currency.

The 294th MPC marks the second meeting under Governor Cardoso’s leadership, indicating a proactive approach to addressing economic challenges.

The next MPC meeting is scheduled for May 20th and 21st, 2024, highlighting the ongoing commitment of the CBN to navigate Nigeria’s economic landscape amidst inflationary pressures.

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Economy

Nigeria Braces for 10th Consecutive Interest Rate Hike by Central Bank

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Central Bank of Nigeria (CBN)

As Nigeria grapples with persistently high inflation, the Central Bank of Nigeria (CBN) is gearing up to implement its tenth consecutive interest rate hike in a bid to curb the soaring prices and attract investment.

Analysts surveyed by Bloomberg are anticipating a substantial 125 basis-point increase in the key rate to 24%, marking one of the most significant adjustments in the current tightening cycle.

The decision, expected to be announced by Governor Olayemi Cardoso on Tuesday at 2 p.m. in Abuja, comes on the heels of inflation accelerating to 31.7% in February, far surpassing the central bank’s target range of 9%.

This surge has been primarily attributed to the sharp depreciation of the naira, prompting authorities to devalue the currency twice since June to narrow the gap with the unofficial market rate and encourage investor confidence.

While these measures have seen the naira strengthen in recent days and bolstered investment inflows, including a fourfold increase in overseas remittances and significant foreign investor portfolio asset purchases, there remains a palpable need for more decisive action.

Giulia Pellegrini, a senior portfolio manager at Allianz Global Investors, emphasized the necessity for the CBN to intensify its tightening efforts to regain foreign investors’ confidence in the local bond market.

While acknowledging the positive strides made by the central bank, Pellegrini stressed the importance of a more assertive approach to prevent the diversion of investor attention to other frontier markets.

As the Nigerian economy navigates through these challenging times, the impending interest rate hike signals the CBN’s determination to address inflation head-on and foster a more stable economic environment.

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