Category: West Africa

ByJosie Cox The Naira is being hit but it’s not alone, with the currencies of other major oil economies including Norway and Russia feeling the pain. Agence France-Presse/Getty Images Here’s one oil economy that’s having a particularly rough ride. Nigeria, which is dependent on oil and natural gas for 96% of export revenues and 80% of government revenues, has been slammed hard by a slump prices over the last weeks and on Thursday hit yet another all-time low against the dollar – a veritable kick in the teeth for the central bank after it just last week intervened by selling dollars and buying the Naira after the dollar soared above 172 naira. The intervention initially triggered some respite, but today the dollar climbed above the previous peak, to above 173, traders said. The Naira’s drop puts Nigeria among the worst hit of the word’s oil producers, but the ruble, […]

Click here to view full article at blogs.wsj.com

Abuja — Court documents presented by Amnesty International (AI) have exposed the fact that Shell repeatedly made false claims about the size and impact of two major oil spills at Bodo in the Niger Delta, allegedly in an attempt to minimise its compensation payments. AI said in a report yesterday that evidence that Shell underestimated the Bodo spills emerged in a United Kingdom (UK) legal action brought by 15,000 people whose livelihoods were devastated by oil pollution in 2008. The court action has forced Shell to finally admit the company had underplayed the true magnitude of at least two spills and the extent of damage caused. According to AI, the documents also showed that Shell had known for years that its pipelines in the Niger Delta were old and faulty. "The potential repercussions are that hundreds of thousands of people may have been denied or underpaid compensation based on […]

Click here to view full article at allafrica.com

Decline in the global price of oil is eroding Nigeria’s external reserves and increasing pressure on the country’s currency. THE Federal Government is at risk of losing part of its 2014 crude oil earnings of over $84 billion (N13.4 trillion) to the continuous decline in the prices of crude oil. Nigeria realized about $40 billion (N6.4 trillion) from crude oil export between January and June 2014, having earned N13.4 trillion in 2013. According to the United State Energy Information Administration (EIA), This revenue positioned Nigeria as the fourth highest earner among oil producing countries, after Saudi Arabia ($274 billion), Kuwait ($45 billion), and Iraq ($45 billion), during the same period. Already, members of the Petroleum Exporting Countries (OPEC) had its revenue slashed in the first half of this year due to the decline in the price of crude oil during the period. As at Monday this week, the cost […]

Click here to view full article at allafrica.com

Central bank rules to curb foreign-currency borrowing by Nigerian lenders threaten to halt Eurobond sales by banks in Africa ’s biggest oil producer as lower crude prices heighten risks to the naira. Banks will probably turn to rights offers and naira debt rather than selling dollar bonds, according to FBN Capital, the investment-banking unit of Nigeria ’s largest bank by assets, Lagos-based FBN Holdings Plc. (FBNH) Nigerian dollar notes lost 0.4 percent this month, compared with a 2.2 percent average return among 57 emerging markets tracked by Bloomberg indexes . Slumping oil prices are weighing on the outlook for Africa’s biggest economy, weakening the naira and eroding foreign-currency earnings. The central bank in a statement dated Oct. 24 capped the amount of borrowing banks can do in foreign currencies as percentages of shareholders’ funds. “The central bank rule will slow the issuance of dollar bonds,” Bunmi Asaolu, a banking […]

Click here to view full article at www.bloomberg.com

Related Topics Nigeria Nigeria: Synagogue Victims Died of Crush Inju… Petroleum Nigeria: NASS, FG Disagree Over N1.2 Trillion… Ads by Google WORRIED about the slow growth of the downstream oil and gas sector due to what it considered as a result of the regulated regime in the industry, the Federal Government yesterday stressed the need to eliminate price subsidy and stimulate competition. Besides, the country’s downstream sector requires investments of about $20 billion (N3.2 trillion) yearly to support the sector. This came as the House of Representatives assured stakeholders that the long-awaited Petroleum Industry Bill (PIB) would be passed into law before May 2015. The Minister of Petroleum Resources, Diezani Alison-Madueke, who spoke at the ongoing eighth oil trading expo in Lagos, said that to provide a competitive market environment and sustain supply, the downstream sector should be fully deregulated. According to her, more investments in the sector will […]

Click here to view full article at allafrica.com

The Federal Government, yesterday, raised an alarm over the decline in the global crude oil prices, saying that it is already putting in place stricter measures to cushion the effect of the drop on the Nigerian economy. "Nigeria has two to three months of rainy day savings to cushion it while contingencies are put in place should world oil prices continue to fall," Ngozi Okonjo-Iweala, Co-ordinating Minister for Economy told the Financial Times. Okonjo-Iweala disclosed that should oil price dip below $78, the country would have to draw down on the Excess Crude Account (ECA). She said, "Our intention is not to run in there and raid it, but even if prices continue to go down we can survive sufficiently for two to three months. That is the time needed to get other measures in place. What you don’t want is a hard landing." "Our buffers are slimmer this […]

Click here to view full article at allafrica.com

The rising spate of insecurity in Bayelsa state heightened Friday as gunmen, suspected to be sea pirates, carried out attacks on barges and boats along the Nembe waterways in Bayelsa, abducting six oil workers and four policemen. The pirates also dispossessed the policemen of a gunboat and made away with the arms onboard. The attacks, according to witnesses, occurred separately on Friday causing fear and tension amongst coastal communities and boat operators as the security operatives appeared helpless and defeated. When contacted for comments, the spokesperson for Bayelsa police command, Alex Akhigbe, a Deputy Superintendent of Police, said he was on official duty in Abuja and unaware of developments in Bayelsa. The state Police Commissioner, Valentine Ntomchukwu, claimed he was busy in a meeting. Witnesses however said the Police gunboat was escorting a barge operated by the Nigerian Agip Oil Company (NAOC) when it was attacked. The sea pirates, […]

Click here to view full article at allafrica.com

Lagos — The Nigeria Employers Consultative Association (NECA) has berated the federal government over what it described as its lackluster plan on how the country will deal with the fall in international price of crude oil. The Coordinating Minister of the Economy, Dr. Ngozi Okonjo-Iweala, had recently said the federal government has put in place contingency plans to deal with the dwindling price of crude oil. But speaking at a press conference in Lagos, Director-General of NECA, Mr. Olusegun Oshinowo, said government ought to flesh out such plans as well as explain the implications of the fall in the price of crude oil to Nigerians and how the nation would cope with the development. He warned that the country is prone to serious economic crisis if there are no concrete plans to deal with the situation and advised Nigerians to cut down on their skyrocketing expenses. He reasoned that […]

Click here to view full article at allafrica.com