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Nigeria: Fresh concern over petrol price hike as Naira falls to ₦945/$1

Published

1 year ago

August 25, 2023

A likely rise in the price of Premium Motor Spirit, popularly called petrol in Nigeria, has surfaced again following a recent plunge of the Nigerian currency, Naira, which now exchanges at over 900 to the United States dollar.

Concerns about whether the pump price could remain the same after the Naira declined against the dollar on the black market from 900 to 920 on Thursday. The naira reached 945 to the dollar in the black market two weeks ago but it recovered.

Recently, the marketers claimed that the CBN’s Importers and Exporters (I&E) official window for foreign exchange, which had a lower exchange rate of approximately N740/dollar, had remained illiquid and was unable to offer the $25 million to $30 million needed for dealers to import PMS.

But state oil firm, Nigerian National Petroleum Company Limited (NNPCL), played down fears of an imminent rise in petrol, insisting that there are no intentions for a price raise. Experts have said NNPCL price assurance should pose concern of another possible price-control regime which will eventually birth payments of subsidy on petrol.

On Thursday, the marketers raised the concern of a possible price hike again following the latest exchange rate. The price is now projected to be between N680/litre to N700/litre for PMS, stressing that the forex rate was about N750/$ to N800/$ at the time the cost of petrol was pegged at N590/litre to N617/litre.

Nigeria, a West African nation, is one of the world’s top oil producers, yet it does not refine crude oil domestically. The state-owned Nigerian National Petroleum Corporation (NNPC) operates four refineries: two in Port Harcourt (PHRC), one each in Kaduna (KRPC), and one in Warri (WRPC). Despite several efforts to restart the refineries, none of them has been operating at full capacity for years.

The need to export petroleum products for refining is a major cost factor that affects the price of the end products. In May, the country launched a 650,000 barrels per day (BPD) integrated, private refinery which according to the central bank governor at the time, Godwin Emefiele, said is expected to generate 12,000 megawatts of electricity and over 135,000 permanent jobs, help the country save $25b, and $30b forex annually.

But the hope has not materialised as the refinery is yet to begin full operation, despite its elaborate commissioning, and projection to get to work by July.

Related Topics:Featured Fuel Subdidy Nigeria

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Moroccan annual inflation rises to 0.8% in November

Published

2 days ago

December 21, 2024

Ifeoluwa Dada

Morocco’s statistics office has confirmed that the country’s annual inflation rate, as determined by the consumer price index, increased from 0.7% in October to 0.8% in November.

Monthly, consumer prices decreased by 0.2% from October.

The primary driver of inflation, food costs, grew by 0.8% compared to the previous year, while non-food inflation climbed by 0.7%. Core inflation, which does not include more erratic items like food, increased 2.6% annually and 0.2% monthly.

According to the central bank, inflation is expected to average 1% this year, down from 6.1% last year.

Despite the Al-Haouz earthquake, a spike in inflation, and worldwide economic challenges, Morocco’s GDP grew by 3.4% in 2023.

A recovery in tourism, robust industrial exports, and rising private consumption—all bolstered by prudent macroeconomic policies—were the main drivers of growth.

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Nigeria’s $42bn foreign reserves enough for 9 months’ imports— Central Bank

Published

3 days ago

December 20, 2024

Ifeoluwa Dada

According to Olayemi Cardoso, Governor of the Central Bank of Nigeria (CBN), the nation’s $42.01 billion in foreign reserves can cover imports of goods and services for almost nine months.

Cardoso promised Nigerians improved economic fortunes in 2025 while addressing the Senate Committee on Banking, Insurance, and Other Financial Institutions yesterday in Abuja at the presentation of the performance index report.

Cardoso stated: “External Reserves rose from $ 38.35 billion it was on September 30, 2024, to $ 42.01 billion as of December 12, 2024”.

He clarified that third-party receipts in Q3 2024 and revenues from taxes connected to crude oil were the main drivers of the rise in foreign reserves during the specified time.

“We saw remarkable improvements in our trade balance and maintained a current account surplus,” he added.

“Our external reserves level can finance over 9.09 months of import of goods and services or 13.91 months only, higher than the international benchmark of 3.0 months and a robust buffer against shocks”.

On cash shortage, the CBN boss reiterated the N150 million fine against any branch of banks caught illegally distributing new Naira notes to currency hawkers and unscrupulous elements and said the Nigerian economy will improve in 2025 through policies and measures.

He predicted a stronger economic future: “Despite our economy’s challenges, there are clear reasons for optimism.

“The gradual stabilization of the forex market, ongoing banking sector recapitalization, and positive growth trends in key sectors, especially the services sector, indicate a path toward recovery and stability.”