A Review of the Nigerian Energy Industry

Financial market update

14 March 2013, Sweetcrude, Lagos – Local and international financial market update.
NIGERIA: The Central Securities and Clearing System (CSCS) Plc, the clearing house of the Nigerian capital market, has made a case for a single central securities depository (CSD) for the country. CSCS has been performing the functions of securities clearing settlement and CSD in the capital since 1997. However, there are strong indications that the Central Bank of Nigeria (CBN) is planning to provide CSD services very soon.

EUROPE: European shares recouped most of their earlier losses to end flat near 4-1/2-year highs on Wednesday, after robust U.S. retail sales data pointed to continued recovery in the world’s biggest economy. The FTSEurofirst 300 index of top European shares provisionally ended flat at 1,194.07 points, after hitting an intra-day low of 1.188.98. U.S. retail sales rose more than expected in February.

INDIA: India’s inflation unexpectedly accelerated in February from a three-year low, limiting scope for the central bank to cut interest rates as the authority prepares to review monetary policy next week. The wholesale-price index rose 6.84 percent from a year earlier, after climbing 6.62 percent in January, the Commerce Ministry said in a statement in New Delhi today.

CHINA: Chinese stocks fell in Hong Kong, dragging the benchmark index down 9.9 percent from its peak, amid concern the government will take steps to avert asset bubbles. Stocks in Shanghai rose for the first time in six days. The Hang Seng China Enterprises Index retreated 0.3 percent as of 3:13 p.m. in Hong Kong. The Shanghai Composite Index closed 0.3 percent higher at 2,270.28, following a five-day, 3.6 percent losing streak.

Bonds – Volatile session yesterday ahead of the auction results as market remained unsure of the direction of rates at the auction. Market opened bullish yesterday but sold off to close as uncertainty crept in on the back of low participation from offshore at the auction even though onshore liquidity was significant enough.

Bills – Demand in the markets was weak and markets relatively quiet on Wednesday as the naira weakened against the dollar, with markets trading cautious.

Money Market – OBB and unsecured O/N stable at 10.50% and 10.75% on Wednesday.

CBN WDAS AUCTION- CBN offered and sold $180m. Marginal rate at 155.76 naira, compared with 155.75 at previous sale on March 11.

Indicative Currency Exchange Rates
Bid             Offer

EURUSD       1.2948           1.2958
GBPUSD       1.4942            1.4952
USDJPY        96.21               96.61
USDCHF        0.9545          0.9565
GBPEUR        1.1539            1.1549
USDZAR       9.2340            9.3340
USDNGN       158.30          159.05
JPYNGN        1.6454            1.6954
CHFNGN       165.85            169.85
EURNGN       204.97            208.97
GBPNGN        236.53           240.53
ZARNGN        17.14               19.14

West Texas Intermediate oil traded near the highest level in two weeks, shrinking its discount to Brent to the narrowest since January. U.S. crude supplies rose and the International Energy Agency cut its demand outlook. WTI for April delivery was at $92.34 a barrel, down 18 cents, in electronic trading on the New York Mercantile Exchange at 10:36 a.m. Sydney time.

Interest rates
NIBOR (%)                         LIBOR (%)

O/N              10.9583             USD 1 month       0.2032
7 Day            11.2083              USD 2 month      0.2415
30 Day         11.5000              USD 3 month      0.2801
60 Day         11.7917                USD 4 month      0.3321
90 Day         12.0000             USD 6 month       0.4449
USD 12 month      0.7300
Y/Y Consumer Inflation January 2013 :          9.00%
FX Reserves: 12 March 2013 (USD bn)            48.173
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     158.95/05   158.42/52  158.78/88    158.45/55

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