A Review of the Nigerian Energy Industry

Financial market update

26 March 2013, Sweetcrude, Lagos – Local and international financial market update.
NIGERIA: Nigeria’s $1billion Eurobond being planned to raise funds from the international capital market to finance gas to power infrastructure will debut before the end of Septemeber 2013 according to the Director General of the Debt Management Office. He also mentioned that the diaspora bond which will enable the Federal Government to pull funds from Nigerians living abroad for developmental projects back home will come on stream hopefully by December.

EUROPE: European stock futures climbed before U.S. data that may show durable-goods orders increased and new-house sales held close to a four-year high last month. Futures on the Euro Stoxx 50 Index, a benchmark for the euro region, advanced 0.2 percent to 2,592 at 7:11 a.m. in London.

INDIA: India’s rupee weakened on concern the government will be unable to rein in a record current- account deficit as inflows into equities slow. The shortfall in the current account, the broadest measure of trade, widened to $31 billion in the fourth quarter from the previous period’s record $22.3 billion, Bank of America Merrill Lynch predicted in a report yesterday before official data due March 28.

CHINA: Notwithstanding rapid revenue growth, China’s budget deficit reached USD 193.2 billion in 2013, marking a 50 per cent increase from the previous year. Despite rapid revenue growth, the budget deficit will reach 1.2 trillion yuan (USD 193.2 billion) in 2013. This marks a 50 per cent increase from the previous year, state run China Daily reported yesterday. The new Vice-Premier Zhang Gaoli addressing the China Development Forum here said the key was to spend wisely and not just let the government expand its share of the national coffers.

Bonds – Market was relatively stable on Monday, yields trading a tight range but going up an average 6bps on the day. Yields had dipped to close last week on the back of some local corporate and offshore demand which came in towards market close on Friday.

Bills – Very quiet market yesterday with the CBN out to offer N280billion in OMO bills across four tenors from 38 to 108 days. No sales were made at the OMO window due to technical difficulties at the Central Bank but we can expect them to come out again today to offer OMO securities.

Money Market – OBB and unsecured O/N rates closing the week at 10.15% and 10.25% respectively. Market still liquid.

CBN WDAS AUCTION- CBN offered $300m and sold $276.6m. Marginal rate at 155.75 naira, compared with 155.76 naira at previous sale on March 20.

Indicative Currency Exchange Rates
Bid            Offer

EURUSD               1.2867         1.2877
GBPUSD               1.5183          1.5193
USDJPY                 94.28          94.68
USDCHF               0.9485         0.9505
GBPEUR               1.1799           1.1809
USDZAR                9.2797         9.3797
USDNGN               157.70         158.45
JPYNGN                1.6727         1.7227
CHFNGN              166.26         170.26
EURNGN              202.91          206.91
GBPNGN              239.44         243.44
ZARNGN              16.99            18.99
Brent oil for May settlement was down 1 cent at $108.16 a barrel on the London-based ICE Futures Europe exchange. The volume of all futures traded was 22 percent below the 100-day average. Prices are down 2.6 per cent in 2013.

Interest Rates
NIBOR (%)                           LIBOR (%)

O/N             10.3333                USD 1 month         0.2042
7 Day           10.5833               USD 2 month         0.2425
30 Day        10.9583               USD 3 month         0.2831
60 Day        11.3750                USD 4 month         0.3311
90 Day        11.6667                USD 6 month         0.4459
USD 12 month       0.7310
Y/Y Consumer Inflation February 2013 :           9.5%
FX Reserves: 15 March 2013 (USD bn)              48.315
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   158.45/55   157.95/05 158.18/28    158.20/30

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