- Special FX rate for NNPCL’ll crash petrol prices – TUC
The Nigerian Equities market began the trading week with a bearish sentiment as the All-Share Index declined by 0.24 percent to close at 96,205.84 points, despite a higher number of gainers compared to losers, with 34 stocks advancing and 20 declining.
The market saw a supplementary listing of 8 billion ordinary shares of JAPAULGOLD, which slightly softened the decline in market capitalization to 0.20 percent, bringing it to N55.28 trillion, compared to the 0.24 percent drop reflected by the ASI.
As a result, equity investors recorded a loss of N111 billion in their portfolios.
Leading the decliners were JBERGER (-10.00%), TRANSPOWER (-9.99%), MCNICHOLS (-9.40%), UPL (-8.99%), and CUTIX (-6.00%), each experiencing significant share price losses. Conversely, the top gainers were ETERNA (+10.00%), TANTALIZER (+10.00%), OANDO (+9.95%), FTNCOCOA (+9.93%), and UACN (+9.81%), all posting substantial price increases.
Trading activity on the Nigerian Exchange showed robust performance, with the total number of deals, traded volumes, and values increasing by 30.46 percent, 97.29 percent, and 21.82 percent, respectively, to 10,412 deals, 774.38 million units, and N14.65 billion.
Sectoral performance was mixed; the Banking, Insurance, and Oil & Gas indexes posted gains of 0.68 percent, 2.48 percent, and 1.14 percent, respectively, driven by investor interest in stocks such as JAIZ BANK, WEMA BANK, CORNERST, AIICO, ETERNA, and OANDO.
On the other hand, the Consumer Goods and Industrial Goods indexes recorded slight declines of 0.43 percent and 0.04 percent, respectively. JAIZ BANK was the most actively traded stock by volume, with 247.04 million units changing hands in 162 transactions, while ZENITH BANK led in traded value, totaling N6.42 billion.
In the money market, NIBOR rose across all tenors as money market conditions tightened, with banks holding liquidity seeking to capitalize on higher rates. However, key money market rates such as the Open Repo Rate (OPR) and Overnight Lending Rate (O/N) declined by 0.68 percent and 0.65 percent to close at 30.58 percent and 31.05 percent, respectively.
Meanwhile, NITTY rose across the board for most tenor buckets monitored, with the average secondary market yield on T-bills declining by 0.03 percent to 18.28 percent on buy pressure.
In the FGN Bond market, trading activity was relatively bearish, resulting in a marginal 0.03 percent increase in the average yield to 18.72 percent. In Nigeria’s sovereign Eurobonds market, sell pressure at the short, mid and long ends of the yield curve led to a 0.07 percent increase in the average yield to 9.98 percent.
In the foreign exchange market, the Naira strengthened, gaining 0.81 percent against the US dollar in the official market, closing at ₦1,580.46 per dollar. However, demand pressure in the parallel market led to a 0.61 percent depreciation of the Naira, sliding to ₦1,655 per dollar.
Special FX rate for NNPCL’ll crash petrol prices – TUC
President, Trade Union Congress, Festus Osifo, has called on the Central Bank of Nigeria and the Nigeria Customs Service to give a special foreign exchange rate to the Nigerian National Petroleum Company Limited.
Osifo said if the NNPCL is granted a special forex rate of about ₦1000/$ instead of the ₦1,600/$ official rate, the cost of petrol importation by the state-run company will crash and fuel prices will drop to around ₦600 from its current pump price of over ₦900, depending on the part of the country.
Osifo who also doubles as the President of the Petroleum and Natural Gas Senior Staff Association of Nigeria, stated these on a live television programme on Monday.
He emphasized that the real problem currently facing the country is the devaluation of the nation’s currency and not subsidy removal in May 2023 by President Bola Tinubu.
“The ultimate elephant in the room is devaluation,” Osifo stated, explaining that petrol would be selling at around ₦350 if the naira was not devalued simultaneously with the removal of petrol subsidy last year, declining from around ₦700/$1 to over ₦1,600/$1.
The TUC boss said subsidy is still being shouldered on petrol by the NNPCL despite the fresh adjustment of petrol pump price from around ₦600 to over ₦900.
Osifo said, “If you give a special rate to the NNPC, you don’t need to pay for subsidies anymore. The same special rate that was given to Dangote (Refinery) to sell, a special rate was given.
“Before now, we have had our Customs giving special rates. So, that special rate should be given in that sector.
“With the sale of crude to Dangote in naira, and you decide that that crude you are selling to Dangote in naira, the exchange rate will be ₦1,000 to a dollar. If you do that, all marketers can go to Dangote and sell at a reduced rate compared to what is practicable today.
“It is about the exchange rate and that is what we have propounded over time.”
The TUC boss warned that if the government does not take immediate decision, the effect of the fresh hike in petrol prices will reverberate across the length and breadth of Nigeria, with attendant job losses and companies folding up, as foretold by industry groups like the Nigerian Association of Chambers of Commerce, Industry, Mines and Agriculture, the Lagos Chamber of Commerce and Industry and Nigerian Employers Consultative Association.
He said the organs of the TUC would meet to decide the way forward should the government fail to revert petrol prices to around ₦600.
