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The Naira was relatively stable against the US Dollar at the Nigerian Autonomous Foreign Exchange Market (NAFEM) segment of the currency market on Wednesday, December 18.

The value of the local currency marginally depreciated against the greenback yesterday by 15 Kobo or 0.01 per cent to sell at N1,544.20/$1 at the official market, in contrast to the preceding day’s N1,544.05/$1.

In the same vein, the Nigerian currency lost N7.44 against the Pound Sterling in the spot market during the trading day to sell for N1,954.07/£1 compared with Tuesday’s closing price of N1,946.63/£1 and against the Euro, it depreciated by N3.16 to trade at N1,614.89/€1 versus the preceding session’s N1,611.73/€1.

The country’s exchange rate seems to be stable at the moment as a result of the Electronic Foreign Exchange Matching System (EFEMS) of the Central Bank of Nigeria (CBN) designed to ensure transparency in the FX market.

On Wednesday, President Bola Tinubu presented the 2025 budget to the National Assembly, with an exchange rate projection of N1,500/$1.

The budget projects that inflation will decline from the current rate of 34.6 per cent to 15 per cent next year, while the exchange rate will improve from approximately N1,700 per Dollar to N1,500/$1. The base crude oil production assumption is set at 2.06 million barrels per day.

At the parallel market, the Nigerian currency remained unchanged against the Dollar at midweek at N1,660/$1.

Meanwhile, in the cryptocurrency market, profit-taking continued as the US Federal Reserve hinted at a few rate cuts in 2025.

US Federal Reserve chairman, Mr Jerome Powell said at a press conference after the meeting that the central bank wasn’t allowed to own Bitcoin under current regulations — in response to a question about President-elect Donald Trump’s strategic reserve promises.

Litecoin (LTC) fell by 8.4 per cent to $108.31, Ripple (XRP) slumped by 6.1 per cent to $2.36, Dogecoin (DOGE) lost 5.5 per cent to sell at $0.3618, Cardano (ADA) depreciated by 3.9 per cent to $0.9812, Ethereum (ETH) declined by 3.8 per cent to $3,680.00, Bitcoin (BTC) weakened by 2.5 per cent to $101,166.28, Solana (SOL) dropped 2.3 per cent to trade at $210.35, and Binance Coin (BNB) went down by 1.00 per cent to $701.66, while the US Dollar Tether (USDT) and the US Dollar Coin (USDC) closed flat at $1.00 each.

–By Adedapo Adesanya

The management of Dangote Refinery has picked a hole in the claims by the Nigerian National Petroleum Company (NNPC) Limited that it supported the business with a $1 billion loan when it was undergoing a liquidity crisis.

In a statement on Wednesday night, the private oil refinery believed to be worth about $20 billion said the claims by the NNPC were not true.

In the disclosure made available to Business Post, the Group Chief Branding and Communications Officer of Dangote, Mr Anthony Chiejina, said, “We would like to clarify that this is a misrepresentation of the situation as $1bn is just about 5 per cent of the investment that went into building the Dangote Refinery.”

“Our decision to enter into a partnership with NNPCL was based on recognition of their strategic position in the industry as the largest off-taker of Nigerian crude and at the time, the sole supplier of gasoline into Nigeria.

“We agreed on the sale of a 20 per cent stake at a value of $2.76 billion. Of this, we agreed that they will only pay $1 billion while the balance will be recovered over a period of 5 years through deductions on crude oil that they supply to us and from dividends due to them. If we were struggling with liquidity challenges we wouldn’t have given them such generous payment terms.

“As of 2021 when the agreement was signed, the refinery was at the pre-commission stage. In addition, if we were struggling with liquidity issues, this agreement would have been cash-based rather than credit-driven.

“Unfortunately, NNPCL was later unable to supply the agreed 300 thousand barrels a day of crude given that they had committed a greater part of their crude cargoes to financiers with the expectation of higher production which they were unable to achieve.

“We subsequently gave them a 12-month period for them to pay cash for the balance of their equity given their inability to supply the agreed crude oil volume. NNPCL failed to meet this deadline which expired on June 30th 2024. As a result, their equity share was revised down to 7.24 per cent. These events have been widely reported by both parties.

“It is, therefore, inaccurate to claim that NNPCL facilitated a $1 billion investment amid liquidity challenges. Like all business partners, NNPCL invested, $1 billion in the Refinery to acquire an ownership stake of 7.24 per cent stake that is beneficial to its interests,” he explained.

Mr Chiejina noted that, “NNPCL remains our valued partner in progress, and it is imperative for all stakeholders to adhere to the facts and present the narrative in the correct context, to guide the media in reporting accurately for the benefit of our stakeholders and the public.”

–By Aduragbemi Omiyale

Renaissance Africa Energy Company Limited, a local oil and gas consortium, says it has received ministerial consent to acquire Shell Petroleum Development Company.

The company announced the development in a statement on Wednesday.

The approval was reportedly given by the Minister of State for Petroleum Resources (Oil), Heineken Lokpobiri. Efforts to get official confirmation from the Nigerian Upstream Petroleum Regulatory Commission were unsuccessful.

In January, Shell said it agreed to sell its Nigerian onshore oil assets to Renaissance Africa for over $1.3bn — subject to regulatory approvals.

The assets are said to hold an estimated 6.73 billion barrels of oil and condensate, along with 56.27 trillion cubic feet of associated and non-associated gas.

Renaissance is a consortium formed by ND Western, Aradel Energy, First Exploration & Production, Waltersmith, and Petrolin.

However, on October 21, when the federal government announced the approval of other divestment deals, the Shell-Renaissance transaction did not scale the regulatory test.

NUPRC’s CEO, Gbenga Komolafe said the commission rejected the deal because it “could not scale (the) regulatory test.”

There are also concerns about numerous lawsuits and allegations hanging over Shell Nigeria over human rights abuses and environmental degradation in the Niger Delta region.

NUPRC said that it would only approve the sale if Shell takes responsibility for oil spills and agrees to fund cleanup efforts in the Niger Delta.

But providing updates in the statement, Renaissance said the deal has now been consented to by President Bola Tinubu, who doubles as the minister of petroleum resources.

“Renaissance Africa Energy Company Limited is pleased to announce that the Minister of Petroleum Resources has granted his consent to the sale of The Shell Petroleum Development Company to Renaissance,” the statement read.

“This approval marks a significant step forward from the announcement of the Sale and Purchase Agreements in January 2024.”

On October 30, the special adviser to the president on energy, Olu Verheijen, said the issues around Shell’s proposed sale of its onshore assets to Renaissance would be resolved soon.

Recall that in October, the government announced four divestment request from Mobil Producing Nigeria Unlimited to Seplat Energy Offshore Limited divestment, Equinor Nigeria Energy Company Limited to Project Odinmin Investments Limited, TotalEnergies EP Nigeria Limited to Telema

Energies Nigeria Limited, and the Nigerian Agip Oil Company Limited to Oando Petroleum and Natural Gas Company Limited divestment.

-By Damilola Aina

The Nigerian Exchange (NGX) Limited gained 0.55 per cent on Monday on the back of sustained bargain-hunting activities by investors, which took the bourse closer to the 100,000-point threshold.

Customs Street has crossed 100,000 points more than three times this year, but profit-taking activities by investors have always been the pullback.

In January, it crossed the psychological mark only to fall below the next month and then crossed again in March and crumbled in April.

This continued till June, when it went past 100,000 point and faltered the next month but picked itself up in the same month and going down again in July. It has remained below the threshold from the seventh month of 2024 till now.

On the first trading session of this week, the All-Share Index (ASI) increased by 544.57 points to 99,922.63 points from 99,378.06 points and the market capitalisation jumped by N330 billion to close at N60.572 trillion compared with the preceding session’s N60.242 trillion.

The day ended with 35 price gainers and 25 price losers, representing a positive market breadth index and strong investor sentiment.

Royal Exchange and Living Trust Mortgage Bank gained 10.00 per cent each to quote at 66 Kobo and N3.30 apiece, International Breweries grew by 9.90 per cent to N4.55, Guinea Insurance rose by 9.84 per cent to 67 Kobo, and Caverton expanded by 9.60 per cent to N2.17.

Conversely, University Press shed 9.81 per cent to settle at N3.77, Haldane McCall declined by 9.62 per cent to N4.70, International Energy Insurance slumped by 9.52 per cent to N1.33, ABC Transport shrank by 8.70 per cent to N1.05, and Sovereign Trust Insurance weakened by 8.24 per cent to 78 Kobo.

During the trading day, investors traded 740.9 million shares valued at N16.9 billion in 10,430 deals compared with the 544.2 million shares worth N10.6 billion traded in 8,464 deals last Friday, implying a surge in the trading volume, value, and number of deals by 36.15 per cent, 59.43 per cent and 23.23 per cent, respectively.

The most active stock for the session was Sterling Holdings with 197.0 million units sold for N955.5 million, Wema Bank transacted 150.5 million units valued at N1.3 billion, eTranzact exchanged 70.1 million units worth N473.2 million, Tantalizers traded 57.3 million units for N101.2 million, and Access Holdings transacted 20.5 million units valued at N491.9 million.

Business Post reports that the bears and the bulls battled for the control of the market yesterday, with the former grabbing three of the five key sectors of the bourse at the close of transactions.

The insurance space lost 0.96 per cent, the banking index went down by 0.06 per cent, and the energy counter decreased by 0.02 per cent.

However, the consumer goods sector improved by 1.24 per cent, and the industrial goods industry went up by 0.09 per cent.

-By Dipo Olowookere

Nigeria’s inflation rose to 34.60 per cent in November 2024, reflecting a 0.72 per cent increase from October’s rate of 33.88 per cent.

This came as Nigerians expressed optimism that the level of inflation across the country would decelerate in the next six months

This was one of the outcomes of the Inflation Expectations Survey Report for November published by the Statistics Department of the Economic Policy Directorate of the Central Bank of Nigeria.

The Consumer Price Index report released by the National Bureau of Statistics on Monday indicated that the country’s latest inflation rate marked a significant year-on-year rise, with the November 2024 rate being 6.40 percentage points higher than the 28.20 per cent recorded in November 2023.

The report read in part, “In November 2024, the headline inflation rate was 34.60 per cent relative to the October 2024 headline inflation rate of 33.88 per cent. Looking at the movement, the November 2024 headline inflation rate showed an increase of 0.72 percentage points compared to the October 2024 headline inflation rate.

“On a year-on-year basis, the headline inflation rate was 6.40 percentage points higher than the rate recorded in November 2023 (28.20 per cent). This shows that the headline inflation rate (year-on-year basis) increased in November 2024 compared to the same month in the preceding year (i.e., November 2023).”

The rise in inflation is largely driven by food price increases, which continue to place a strain on Nigerian households. On a month-on-month basis, the headline inflation rate showed a marginal slowdown, standing at 2.638 per cent in November compared to 2.640 per cent in October.

While inflation remains high, this slight dip indicates a slower pace of price increases than the previous month.

However, the year-on-year increase still highlights the ongoing pressure on consumers, with the cost of living continuing to climb.

Food inflation has also seen a sharp rise, reaching 39.93 per cent in November 2024, up from 32.84 per cent in the same period last year. Prices for staple foods such as yam, rice, maize, and palm oil have surged, contributing to the increase in food inflation.

Other items such as guinea corn, millet, and meat have also seen notable price hikes.

On a month-on-month basis, food inflation rose by 2.98 per cent, slightly up from 2.94 per cent in October. This increase is attributed to higher prices for items such as fish, rice, dairy products, and meat.

The 12-month average food inflation rate for the period ending November 2024 stands at 38.67 per cent, marking an 11.58 percentage point rise from the previous year’s 27.09 per cent.

The significant increase in food prices is a key driver of the overall inflationary pressures facing the country, highlighting the difficulties in managing food supply chains and meeting domestic demand.

Core inflation, which excludes food and energy prices, rose to 28.75 per cent in November 2024, compared to 22.38 per cent in the same period last year.

This increase reflects rising costs in other sectors, particularly in transportation, housing, and personal services. The highest increases were recorded in the prices of taxi journeys, bus fares, rents, and personal grooming services.

Month-on-month core inflation decreased slightly to 1.83 per cent in November from 2.14 per cent in October, but the annualised rate continues to climb, reflecting broader economic pressures.

The twelve-month average for core inflation stands at 26.64 per cent, up from 20.35 per cent in November 2023.

The ongoing rise in core inflation indicates that price pressures are not limited to food alone but are widespread across various sectors of the economy.

Regional variations in inflation are also evident. Bauchi, Kebbi, and Anambra recorded the highest year-on-year inflation rates at 46.21 per cent, 42.41 per cent, and 40.48 per cent, respectively.

In contrast, Delta, Benue, and Katsina recorded the lowest inflation rates, ranging from 27.47 per cent to 29.57 per cent.

On a month-on-month basis, Yobe, Kebbi, and Kano saw the highest inflation increases at 5.14 per cent, 5.10 per cent, and 4.88 per cent, respectively while Adamawa, Osun, and Kogi recorded the slowest rises in inflation.

Food inflation showed significant regional disparities as well. Sokoto, Yobe, and Edo recorded the highest year-on-year food inflation rates at 51.30 per cent, 49.69 per cent, and 47.77 per cent, respectively. Kwara, Kogi, and Rivers saw slower increases in food prices, with year-on-year rates of 31.39 per cent, 32.95 per cent, and 33.27 per cent, respectively.

On a month-on-month basis, Yobe, Kano, and Kebbi experienced the steepest rises in food inflation at 6.52 per cent, 5.95 per cent, and 5.68 per cent, respectively.

Urban inflation in November 2024 stood at 37.10 per cent, a 6.88 percentage point increase from the 30.21 per cent recorded in November 2023. This represents a higher inflation rate than in rural areas, where inflation reached 32.27 per cent, up by 5.84 percentage points from the previous year.

On a month-on-month basis, urban inflation rose by 2.77 per cent, while rural inflation was slightly lower at 2.51 per cent.

The twelve-month average for urban inflation stands at 35.07 per cent, reflecting a 9.62 percentage point increase from 25.45 per cent in November 2023.

Rural inflation, however, has a twelve-month average of 30.71 per cent, up by 8.00 percentage points from 22.71 per cent in the same period last year.

The continued rise in inflation signals challenges for Nigerian consumers and businesses, with the cost of living showing no signs of abating.

Before the November inflation figure was released, Meristem Securities analyst had projected a higher headline inflation figure at 34.64 per cent, food inflation was expected to come in at 40.03 per cent in November but stood at 39.93 per cent.

However, the actual core inflation was higher than projected. Core inflation, which includes all items less farm produce and energy, stood at 28.75 per cent was 214 basis points above Meristem’s forecast of 26.61 per cent.

Asset management firm, Arthur Steven Asset Management Limited, in a macroeconomic update on Monday said that it expects inflation to decrease in December.

“We expected inflation to decrease in December, as we anticipate a slight decrease by two per cent to 34 per cent. The tightening of the monetary policy rate is attracting investors to the fixed-income market, drawing attention away from equities. This sentiment is likely to persist if the monetary policy rate continues to rise,” ASAM said

If the projection comes to pass, it would still be far away from the 21.4 per cent target set by the Central Bank of Nigeria earlier in the year.  At the end of its last Monetary Policy Committee meeting in November, the benchmark interest rate had been increased to 27.50 per cent.

Meanwhile, Nigerians have said that they expect the level of inflation to decelerate in the next six months.

This was one of the outcomes of the Inflation Expectations Survey Report for November published by the Statistics Department of the Economic Policy Directorate of the Central Bank of Nigeria.

The CBN started publishing the inflation report, Purchasing Managers’ Index, and Business Expectation Survey as part of its drive to improve communication between the apex and its stakeholders.

The report said, “Business and household respondents expect the level of inflation to gradually ease over the next six months.”

Also, businesses and households believed that the current rate is high. Household respondents predominantly drove the sentiments. A breakdown of the perception indicated that the largest businesses had the highest inflation perception while small businesses recorded the lowest perception.

Similarly, the perception of inflation by people residing in urban areas was higher. Also, inflation perception by income distribution indicated that more households earning between 100,001 – 150,000 per month perceive inflation to be higher.

Some of the major drivers of the inflation perception include energy costs, transportation costs, exchange rates, and insecurity.

-By Sami Tunji and Oluwakemi Abimbola