A Review of the Nigerian Energy Industry

Financial market products & services update

*Financial markets.
*Financial markets.

20 October 2015, Sweetcrude, Lagos – Local and international financial market products and services update.
FX: The special auction fund maintained at 197.00 on Friday. Gross FX reserves on a 30 day moving average now at $30.060bn from $30.37 as at 30 Sept 2015.

FIXED INCOME: Yesterday had a soft start compared to last week’s strong moves. We saw a pause in bonds and bills from recent bullish run. TSA debit on Friday of N305bn caused the dampened demand with money market down to N800bn. Cash is still enough to support pockets of demand this week especially on short dated bills and at the T-bill auction this week.

COMMODITIES: Oil halted its decline after slipping to a two-week low before U.S. government data forecast to show crude stockpiles expanded in the world’s biggest consumer.
November futures, which expire Tuesday, rose as much as 0.9% in New York after sliding 2.9% Monday. Inventories probably climbed by 3.5 million barrels last week, according to a Bloomberg survey before an Energy Information Administration report Wednesday. Iran is preparing to output once world powers remove sanctions on its economy, regardless of any decisions by OPEC, Oil Minister Bijan Namdar Zanganeh told reporters in Tehran.

NIGERIA: The oil and gas sector contributed N1.782 trillion to Nigeria’s Gross Domestic Product, GDP, in the Second Quarter, Q2 2015, according to the National Bureau of Statistics, NBS. Giving a breakdown of the oil and gas sector’s contribution, the NBS Nigerian GDP Report for Quarter Two 2015, said the Crude Petroleum and Natural Gas sub-sector in the Mining and Quarrying sector accounted for N1.746 trillion of the country’s GDP during the period.
Also, the Oil Refining sub-sector, under the manufacturing sector accounted for N35.24 billion, just as This is compared to the N1.39 trillion and N41.5 billion contributed by the crude petroleum and natural gas sub-sector, and the oil refining sub-sector, respectively, in Q1 2015.

E.U: The European Central Bank said lending conditions largely continued to improve in the third quarter, spurred by its asset-purchase program and tighter competition among banks.
Credit standards on loans to companies eased for the sixth consecutive quarter, the ECB’s Bank Lending Survey showed on Tuesday. Terms for mortgages tightened, with banks citing national regulation as the primary cause. A small majority of lenders reported an increase in profitability over the past six months as a result of the central bank’s quantitative-easing program, though a deterioration is seen over the next two quarters.

U.K: David Cameron said Chinese President Xi Jinping will bring more than 30 billion pounds ($46 billion) in deals and investment on his visit to Britain this week, as the prime minister defended himself against charges he was being too warm towards his visitor.
The deals will create 3,900 jobs in the U.K., in sectors including the creative industries, retail, energy, health and technology, financial services, aerospace and education, Cameron’s office said in an e-mailed statement, without giving further details. Meanwhile, 5,200 British steelworkers face losing their jobs, according to the Trades Union Congress, after a series of plants announced job cuts in the face of cheaper imports, including from China. Cameron said Monday he would raise the issue of dumping of steel on the international market with Xi during their meetings.

Macro Economic Indicators
Inflation rate (YoY) for Nov., 2014                   9.40%
Monetary Policy Rate current                          13.00%
FX Reserve (Bn $) as at January 09 2015     30.055

Money Market Highlights
O/N                                  01.1050
30 Days                           12.9781                                                                                                                            90 Days                          15.0166
180 Days                         16.1811

USD 1 Month                  0.1942
USD 2 Months                0.2495
USD 3 Months                0.3171
USD 6 Months                0.5184                                                                                                                      USD 12 Months             0.8256

Benchmark Yields
Tenor     Maturity     Yield (%)
91d           21-Jan-16          07.19
182d         21-Apr-16         09.94
364d         06-Oct-16         11.08
2yr            31-Aug-17         12.25
3yr            30-May-18        12.27
5yr            13-Feb-20         12.93

Indicative Currency Exchange Rates
                         Bid          Offer
USDNG         197.00        199.50
EURUSD       1.1254         1.1499
GBPUSD       1.5380         1.5582
USDJPY        119.56         119.59
USDCHF       0.94675     0.9569
GBPEUR       1.3532        1.3736
USDZAR      13.1365       13.3399
JPYNGN      161.8497    161.9503
CHFNGN       204.99      206.68
EURNGN       217.24       219.60
GBPNGN        309.40     310.79
ZARNGN          14.69      16.61

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