A Review of the Nigerian Energy Industry

Financial market update

08 February 2013, Sweetcrude, Lagos – Local and international financial market update.
NIGERIA: The Central Bank of Nigeria (CBN) said it has disbursed a total of N181.42 billion under its Power and Airline Intervention Fund (PAIF), as at December 31, 2012. The banking sector regulator disclosed this in a chart posted on its website Wednesday. It showed that in the month under review, while 15 airline projects benefited a total of N90.92 billion from the fund, a total of N90.50 billion was also disbursed to 21 power projects as at December. However the chart did not reveal the names of the firms and projects that benefitted from the sum.

EUROPE: European Union leaders prepared the first-ever cuts in the bloc’s budget, bowing to U.K. Prime Minister David Cameron’s insistence on thrift at the EU level. After an all-night bargaining session interspersed with catnaps on couches at EU headquarters in Brussels, the leaders reassembled at 6:30 a.m. to consider a 2014-2020 spending ceiling of 960 billion euros ($1.3 trillion), down from an original proposal of 1.047 trillion euros and less than the 994 billion euros spent in the current budget cycle.

INDIA: Indian stocks climbed, snapping a six-day decline, amid speculation the government may step up policy measures to revive an economy forecast to expand at the slowest pace in a decade. The BSE India Sensitive Index rose 0.3 percent to 19,637.32 at 11:53 a.m. in Mumbai.

CHINA: China’s stocks rose, driving the benchmark index toward a second week of gains, as reports showed exports beat analysts’ estimates and inflation eased. Retail and auto stocks rallied before the start of a weeklong holiday. The Shanghai Composite Index added 0.8 percent to 2,437.56 as of 1:37 p.m., and is up 0.8 percent this week.

Bonds – The rally continued yesterday across the curve. Market direction however remains unchanged as yields continue to head south.

Bills – Rates came off on Thursday in reaction to the primary auction yesterday, which closed lower than most people’s expectation. The CBN resumed its OMO activity offering N200billion and selling N267billion in reaction the maturities this week.

Money Market – OBB and unsecured O/N rates dipped to 10.25% and 10.50% as the market opened liquid yesterday.

Indicative Currency Exchange Rates
                               Bid           Offer
EURUSD             1.3390         1.3400
GBPUSD              1.5720         1.5730
USDJPY               92.99           93.39
USDCHF              0.9174         0.9194
GBPEUR              1.1738          1.1748
USDZAR              8.9324         9.0324
USDNGN             156.95          157.70
JPYNGN               1.6878         1.7378
CHFNGN             171.08          175.08
EURNGN             210.16          214.16
GBPNGN             246.73          250.73
ZARNGN             17.57              19.57

Oil fell to the lowest level in two weeks in New York as European Central Bank President Mario Draghi said the euro’s strength could hamper an economic recovery, curbing fuel demand. WTI oil for March delivery slid 79 cents to $95.83 a barrel on the New York Mercantile Exchange, the lowest
settlement since Jan. 23.

Interest rates
NIBOR (%)                         LIBOR (%)

O/N               10.7500           USD 1 month           0.1992
7 Day             11.1667            USD 2 month           0.2460
30 Day          11.6667            USD 3 month           0.2920
60 Day          12.0833           USD 4 month           0.3451
90 Day          12.6250            USD 6 month          0.4669
USD 12 month        0.7675
Y/Y Consumer Inflation December 2012 :         12.00%
FX Reserves: 31 January 2013 (USD bn)            45.984
MPR                                                                            12.00%
Source: Reuters, Bloomberg, Central Bank of Nigeria, Financial Market Dealers Association Standard Chartered Bank Nigeria.

                              Hi            Low           Close      Prev.Close
USD/NGN   157.40/50   157.05/15   157.35/45   157.30/40

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