Nigeria has begun selling crude oil and processed petroleum products in naira to stabilize fuel prices and reduce reliance on foreign currency......See Full Story>>.....See Full Story>>
This policy reduces pressure on the naira, stabilizes the dollar-naira exchange rate, and controls inflation.
Nigeria’s oil production in August 2024 was around 1.6 million barrels per day (bpd), just shy of its 2024 objective of 1.7 million bpd. However, the average price of Nigeria’s Bonny Light crude remains below the budget benchmark of $71 per barrel.
Global oil prices have been unpredictable due to geopolitical tensions in the Middle East, which accounts for roughly one-third of global seaborne oil commerce.
The ongoing conflict in the region, combined with OPEC+ supply cuts, has created uncertainty, with the potential for further price spikes if the conflict escalates.
Despite these challenges, Nigeria’s policy of selling crude in naira is expected to increase local refining capacity, reduce dependence on imported fuel, and potentially reinvest savings from imports into other sectors of the economy. This strategic shift, combined with efforts to curb oil theft, has already boosted Nigeria’s export earnings by approximately N188.7 billion in August 2024.