A Review of the Nigerian Energy Industry

Financial market update

Financial markets23 October 2013, Sweetcrude, Lagos – Local and international financial market products and services update.
NIGERIA: Nigeria raised its November official selling price for benchmark Bonny Light and Qua Iboe crudes to the highest in two years, the Nigerian National Petroleum Corp. said in an e-mailed statement.

BONDS: Illiquid market yesterday. We saw some offshore interest pushing yields even lower as we see average yields now trading sub 13%. It appears the bulls still have this market, their resolve strengthened by the trickle down effect of the less than expected US Non Farm Payroll print and drop in US yields on our onshore market.

BILLS: Even less exciting than the bonds market, with very little trades feeding through the market; average yields were left unchanged from previous day. As expected, CBN came in yesterday with another batch of OMO auction to mop up liquidity; selling N79.6bios in 128D and N97.05 bios in 142D.

MONEY MARKET: OBB and ON rates remained unchanged at 10.25% and 10.50% respectively. Market still very liquid inching slightly lower to about N400billion.

US: The US economy added 148,000 jobs in September, official figures show, lower than analysts had predicted. The unemployment rate fell to 7.2% down from 7.3% in August, the US Department of Labour said. The release of the figures was delayed by the partial shutdown of the US government earlier this month. Economists had predicted 180,000 job gains for September, and the lower-than-expected figure could raise fears that the US economy is losing momentum.

EUROPE: The European Central Bank will outline today, how it plans to scrutinize top euro zone lenders before becoming their supervisor in a new role that puts its credibility on the line. The ECB wants to unearth potential risks hidden in banks’ balance sheets before banking supervision is centralized under its roof from November 2014 as the first part of a plan for European banking union aimed at preventing financial crises.

CHINA: China’s benchmark money-market rate jumped the most since July as the central bank refrained from adding funds to markets and corporate tax payments drained cash. The seven-day repurchase rate, a gauge of funding availability in the banking system, surged 42 basis points, or 0.42 percentage point, to 4 percent as of 10:04 a.m. in Shanghai, according to a weighted average compiled by the National Interbank Funding Centre. That was the biggest advance since July 29. The overnight repo rate jumped 67 basis points, the most since June 20, to 3.76 percent.

COMMODITIES: WTI oil fell for a third day as supplies rose in the U.S., the world’s biggest consumer of crude. WTI for December delivery lost as much as 55 cents to $97.75 a barrel in electronic trading on the New York Mercantile Exchange. The November contract expired yesterday after falling $1.42 to $97.80 a barrel.

Indicative Currency Exchange Rates
Bid          Offer

EURUSD       1.3764       1.3814
GBPUSD       1.6182        1.6232
USDJPY         97.38        97.78
USDCHF      0.8951        0.8981
GBPEUR       1.1757        1.1767
USDZAR       9.7337       9.8837
USDNGN     159.00        159.75
JPYNGN      1.6328        1.6828
CHFNGN     177.63         181.63
EURNGN     218.85        222.85
GBPNGN      257.29       261.29
ZARNGN      16.34          18.34

Commodities
WTI oil fell for a third day as supplies rose in the U.S., the world’s biggest consumer of crude. WTI for December delivery lost as much as 55 cents to $97.75 a barrel in electronic trading on the New York Mercantile Exchange. The November contract expired yesterday after falling $1.42 to $97.80 a barrel.

Interest rates
NIBOR (%)                      LIBOR (%)

O/N             10.5000         USD 1 month            0.1700
7 Day           10.8333         USD 2 month            0.2098
30 Day        11.1250          USD 3 month            0.2384
60 Day        11.3750          USD 6 month            0.3584
90 Day        11.7500          USD 12 month          0.6126
Y/Y Consumer Inflation September 2013 :     8.0%
FX Reserves: 18 October 2013 (USD bn)       45.077
MPR                                                                       12.00%
Source: Reuters, Bloomberg, Central Bank of Nigeria, Financial Market Dealers Association Standard Chartered Bank Nigeria.

Fx
Hi             Low         Close         Prev.Close
USD/NGN     
159.55/65  159.15/25   159.50/60    159.82/92

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