- NNPC to Sustain Supply of India’s 10% Crude Oil Demand
The Nigerian National Petroleum Corporation (NNPC) has expressed its readiness to continue to supply 10 per cent of India’s crude oil demand in the face of competing demand for the product from other countries.
This commitment was made yesterday by the Group Managing Director of the NNPC, Mallam Mele Kyari, during a visit by the Indian High Commissioner to Nigeria, Abhay Thakur.
A statement issued yesterday by the corporation’s Group General Manager, Group Public Affairs Division, Mr. Ndu Ughamadu, disclosed that the NNPC boss pledged that Nigeria, through the corporation, would continue to support India’s energy security.
The NNPC boss added that the recent Memorandum of Understanding (MoU) in the area of energy between Nigeria and India would be consummated to further strengthen the bilateral relations between the two countries.
Kyari further stated that NNPC was desirous of growing the energy cooperation with India, adding that it was “time to progress from just talking to walking the talk”.
He said India was a very important market and that NNPC would ensure that the current volume of crude oil supply from Nigeria to India is secured for the collective interest of both countries.
“We are ready to have a robust engagement with the Indian trade team to provide a win-win energy scenario between us. Every trade opportunity that is available will be fully explored,” Kyari said.
He averred that there were lots of untapped investment opportunities in Nigeria’s Liquefied Petroleum Gas (LPG) and expressed the willingness of NNPC to aggressively improve LPG infrastructure and consumption in the country.
Earlier, the Indian High Commissioner to Nigeria, Thakur, thanked the NNPC for the recent renewal of the crude oil term contracts for three Indian companies and sued for increment in the crude oil supply in view of the increasing energy needs of India.
He disclosed that India was ready to provide credit line mechanisms and expertise to help NNPC revamp its massive infrastructure across the country.
“India is prepared to offer Nigeria and particularly the NNPC a credit line mechanism to help her in the areas of refinery maintenance, construction, security, surveillance and anything possible. Our expertise in Information Technology (IT) is available as well. We are ready to cooperate with NNPC to boost our bilateral relations,” Thakur explained.
The Indian High Commissioner also congratulated Mallam Kyari on his appointment as the Group Managing Director of NNPC, noting that the confidence placed in him was well considered for national interest
According to the National Bureau of Statistics (NBS), Nigeria major trading partners in the fourth quarter (Q4) of 2018 were India, China, Spain, France and Netherlands and the major export to these countries was crude petroleum and natural gas, while the major import from these countries was motor spirit.
According to the bureau, India was Nigeria’s major export market in Q4 2018, accounting for 15.5 percent, or N780.1 billion of total exports with the export of crude oil totalingN730.3 billion.
This was followed by natural liquefied gas, N39.1billion, sesame seed, N4.1 billion, cashew nuts worth N2 billion and others.
In the first quarter of 2019, NBS said India was the largest export market for Nigeria with a net worth of N744.9 billion.
According to the report, Nigeria’s export trade to India accounted for 16.43 per cent of total exports, equivalent to N744.9 billion.
It said that the largest export commodity to India was crude oil valued at N684billion followed by LNG at N47.1 billion.
Barclays Tell High Net Worth Investors to Shun Africa and Other Emerging Economies
Barclays to High Net Worth Clients, Stay Off Africa and Other Emerging Economies
Barclays, one of the world’s largest investment banks, has started advising high net worth clients to stay off Africa and other emerging economies.
According to Barclays, despite the recent recovery noticed in emerging-market stocks, investors are better off avoiding the risks that still abound in emerging nations. Barclays Plc, however, advised high net worth clients to focus on U.S equities despite the S&P’s breakneck rally.
The investment bank said emerging economies do not have enough fiscal buffers to spend their way out of the COVID-19 pandemic and will likely continue to struggle in the near-time compared to the US with 12 percent of gross domestic product fiscal-support.
It said the huge US stimulus may halt rebound in emerging-markets stocks as more money is expected to flow into the world’s largest economy and its European counterparts.
“Compared to the U.S., emerging-market economies appear more vulnerable,” said Haider, the London-based managing director and head of global growth markets. “Their central banks have less room to maneuver, their governments may not be able to provide unlimited support and equity markets, given their sector mix, can be more challenged by an economic slowdown.”
Barclays added that even after 33 percent rebound in stocks of emerging markets since the panic selloff subsided in March, stocks are still down by 9 percent from year-to-date while the US S&P 500 stocks are up by 45 percent. Presently, their stocks trading at a 36 percent discount to US stocks, up from 25 percent three months ago.
Crude Oil Rises to $43.1 Per Barrel on Production Cuts Extension
Crude Oil Hits $43.1 Per Barrel Following OPEC’s Production Cuts Extension
Brent crude oil, against which Nigerian oil price is measured, rose by 1.25 percent on Monday during the Asian trading session following OPEC and allies’ agreement to extend crude oil cuts to the end of July.
OPEC and allies, known as OPEC plus, agreed to extend production cuts of 9.7 million barrels per day reached in April to July on Saturday.
In the virtual conference, delegates agreed that members, including Nigeria and Iraq presently struggling to attain a 100 percent compliance level must keep to the agreement or be forced to do so in subsequent months.
Nigeria, Iraq and others failed to keep to the cartel’s agreement in May after reports show that Nigeria only managed to attain a 19 percent compliance level during the month while Iraq struggled to attain just 38 percent in the same month.
Russia and Saudi Arabia, the two largest producers of the group, warned members to stick to the agreed quota if they want to rebalance the global oil market.
“While the errant producers such as Iraq and Nigeria have vowed to reach 100% conformity and compensate for prior underperformance, we still think they will likely continue to have some commitment issues over the course of the summer,” said Helima Croft, head of global commodity strategy at RBC Capital Markets.
“The potential return of Libyan output could also cause considerable challenges for the OPEC leadership.”
Earlier on Monday, Brent crude oil hits $43.1 per barrel, more than a month record-high, before pulling back slightly to $42.83 per barrel.
Gold Dips by 2 Percent on Better Than Expected Job Report
- Gold Dips by 2 Percent on Better Than Expected Job Report
Gold prices declined by 2 percent on Friday following a better than expected US non-farm payroll report.
The report showed an increase of 2.5 million payroll numbers against a decline of 7.5 million predicted by many experts.
The surprise number boosted investors’ confidence in US recovery as many dumped their haven investment (gold) for the stock market.
“We had significantly stronger-than-expected U.S. payroll numbers – an increase of 2.5 million versus an expectation of a decline of 7.5 million – that 10-million swing has brought forward expectations of the economic recovery in the United States,” said Bart Melek, head of commodity strategies at TD Securities.
Spot gold immediately declined by 1.9 percent per ounce to $1,678.81 while the U.S. gold futures slid 2.6 percent to settle at $1,683.
Gold was also being pressured by stronger yields and a slightly firmer dollar, “meaning the opportunity cost to hold gold in the portfolio has gone up,” Melek added.
The surprise didn’t stop there, US Dow Jones was up 614 points despite the protest going on the US and US-China tension.
Also, NASDAQ rose by 29 points while the S&P index added 50 points increase.
Note: Investors generally increase their investments in gold and other haven assets during a crisis to avert risk exposure and do the opposite once they sense a better economy.
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