Tag Archives: Prices

Oil prices continues to rise as markets eye production cuts

Posted on by
Reply

Oil prices rose on Tuesday, the first trading day of 2017, buoyed by hopes that a deal between OPEC and non-OPEC members to cut production would drain a global supply glut.

The deal to cut production kicked in on Sunday.

Benchmark North Sea Brent crude LCOc1 was up 40 cents at 57.22 dollars a barrel by early trading while the U.S. light crude oil CLc1 was up 40 cents at 54.12 dollars a barrel.

Oil futures markets were closed on Monday for New Year public holidays.

Jan. 1 marked the official start of a deal agreed by OPEC and other exporters such as Russia to reduce output by almost 1.8 million barrels per day (bpd).

“First signals suggest the OPEC and non-OPEC production cuts are raising hopes that the global oil oversupply will diminish,” said Hans van Cleef, Senior Energy Economist at ABN AMRO Bank N.V. in Amsterdam.

Ric Spooner, Chief Market Analyst at CMC Markets, agreed.

“Markets will be looking for anecdotal evidence for production cuts.

“The most likely scenario is OPEC and non-OPEC member countries will be committed to the deal, especially in early stages,” Spooner said.

Libya, one of two OPEC countries exempt from the output cuts, has increased its production to 685,000 bpd, from around 600,000 bpd in December, an official at the National Oil Corporation, said on Sunday.

Elsewhere, non-OPEC Middle Eastern oil producer, Oman, told customers last week that it would cut its crude oil term allocation volumes by five per cent in March.

Non-OPEC Russia’s oil production in December remained unchanged at 11.21 million bpd, near a 30-year high.

However, Russia is preparing to cut output by 300,000 bpd in the first half of 2017 in its contribution to the accord.

Rising Bread, Power, Meat Prices Push Inflation To 18.3%

Posted on by
Reply

The inflation rate, which began its upward streak over one year ago, has again accelerated to 18.3 per cent (year-on-year) in October 2016, with 0.48 per cent points higher from the rate recorded in September of the same year (17.9 per cent).

The  report released by the National Bureau of Statistics (NBS) yesterday said that food index was the major contributory factor as it rose by 17.1 per cent (year-on-year) in October, up by 0.47 per cent points from 16.6 per cent recorded in September.

During the month, all major food groups, which contribute to the food sub-index increased with fruits recording the slowest pace of increase at 11.5 per cent.

Also, it said price movements recorded by the all items less farm produce or core sub-index rose by 18.1 per cent (year-on-year) in October, up by 0.4 per cent points from rates recorded in September (17.7 per cent).

Also in  the month, the report noted, the highest increases were seen in housing, water, electricity, gas and other fuels as well as fuels and lubricants for personal transport equipment and education.

“Significant price movement under the Core Sub-index was also recorded for clothing and footwear, which recorded an increase of 17.8 per cent year-on-year. The groups with least growth pace recorded in October were communication (5.7 per cent), restaurants and hotels (9.4 per cent) and recreation and culture (10.3 per cent),” the report said.

It should be noted that the headline index is made up of the core index and farm produce items as processed foods are included in both the core and food sub-indices; this implies that these sub-indices are not mutually-exclusive.

Also,  on a month-on-month basis, the headline index rose by 0.83 per cent in October, higher from the rate recorded in September (0.81 per cent). The urban index rose by 19.9 per cent (year-on-year) in October from 19.5 per cent recorded in September, and the rural index increased by 16.95 per cent in October from 16.4 per cent in September.

On month-on-month basis, the urban index rose by 0.81 per cent in October from 0.79 per cent recorded in September, while the rural index rose by 0.84 per cent in October from 0.83 per cent in September.

“The percentage change in the average composite CPI for the 12-month period ending in October 2016 over the average of the CPI for the previous 12-month period was 14.2 per cent, higher from 13.5 per cent recorded in September. The corresponding 12-month year-on-year average percentage change for the urban index increased from 14.4 per cent in September to 15.3 per cent in October, while the corresponding rural index also increased from 12.6 per cent in September to 13.3 per cent in October,” the report further explained.

Credit:

http://sunnewsonline.com/rising-bread-power-meat-prices-push-inflation-to-18-3/

Crude oil prices stabilize after Trump’s election shock.

Posted on by
Reply

Oil prices reversed some early losses to push higher yesterday as markets recovered from their initial shock at U.S presidential election.

Traders said that crude fundamentals remained weak.

President-elect Donald Trump’s election win initially stunned markets and led Ian Bremmer, president of U.S. risk consultancy, Eurasia Group, to warn that “the world is heading into a profound geopolitical recession.”

However, markets shook off deep post-election losses and recovered yesterday.

“After initially selling off as it became clear Donald Trump would be the next president, commodity prices rallied strongly as the flight to safety unwound,” ANZ bank said yesterday in a note on Trump’s victory.

But the bank added that “there are still serious questions marks as to what it means for commodity markets.”

U.S. West Texas Intermediate (WTI) crude futures were up 15 cents, or 0.3 per cent, from their last settlement at $45.42 a barrel.

WTI was held back somewhat by a 2.4 million barrels rise in U.S. crude inventories to 485 million barrels last week, even though refineries hiked output and imports fell, the U.S. Energy Information Administration said on Wednesday.

International Brent crude oil futures traded at $46.70 per barrel, up 34 cents, or 0.7 per cent, from their last close.

BMI Research said Trump’s expected pro oil and gas industry policies might mean that U.S. “production of oil and gas could recover at a faster rate in 2017 as developers grow more encouraged.”

Goldman Sachs said a Trump presidency would likely result in higher investment and, in time, increased U.S. oil output as the new president-elect has said he would de-regulate fossil fuel production.

Internationally, the bank said Trump’s threat of renewed U.S. sanctions against OPEC-member Iran would, in the short-term, lead to higher production as it “would further incentivize Iran to maximise production in the short- term rather than comply to an OPEC freeze.”

Nigeria’s Economy In Trouble, As Oil Price Crashes Even Lower

Posted on by
1

Nigeria’s economy may be heading for trouble, as oil price crashed even lower at the weekend, thereby threatening the 2015 budget and fiscal plan.

The international price of crude hit a six-year low below USD40 per barrel with West Texas Intermediate crude oil futures as low as USD39.89, while Brent crude declined further to USD45.10 from previous week’s level of USD48.87 per barrel. Nigeria’s sweet crude is similar to the Brent.

It is envisaged that prices will crash even further once Iran begins to enyoy its international pardon by pumping more oil into the already saturated market.

This will spell more doom for Nigeria, which is producing less than its projected 2 million barrels daily, thereby increasing the cash crunch and liquidity flow in the economy, with many states still unable to pay salaries.economy1

The steep decline in oil prices had in March this year forced the National Assembly to settle for USD53 per barrel as the oil benchmark price for 2015 budget, down from USD65 earlier proposed by the Federal Executive Council under ex-president Goodluck Jonathan. The government had earlier in the year effected downward review of the budget benchmark twice in response to sliding oil price from USD78 to USD73 and later to USD65. It even said it had planned for possible price fall scenarios of up to $50/barrel.

With this development, economists are expecting further downwards adjustments in the budgetary benchmark, revenue projections and ultimately expenditure provisions. Also, they expect further pressure on the value of Naira as the development has wiped off any accretion to the country’s Excess Crude Account.

According to the Global Chief Economist, Renaissance Capital, Mr. Charles Robertson, lower oil price will be painful for the budget. It means less money is available for much-needed investment in infrastructure.

Budget projections

The 2015 budget had envisaged federal government’s share to be about N3.6 trillion of total oil component revenue at USD65 per barrel, with estimated production output of 2million barrels per day.

At current oil price, the component accruable to the federal government would drop massively to less than N2.5 trillion, putting the entire budget in disarray. Evidently all the projected expenditure, Vanguard learnt, are already being curtailed in the recurrent expenditure provisions in the budget, while capital expenditure of N634 billion is completely dropped.

Read full story via:  Vanguard

Nigeria Has No Power To Regulate DSTV Prices- MultiChoice

Posted on by
25

?South African digital satellite television company, Multichoice, has defended its decision to increase DSTV subscription rates in Nigeria, saying neither the country nor its courts, has the powers to regulate its prices.

The ruling on the objecti?on by Multichoice Nigeria Limited against an application seeking to stop ?the price increase ?has been scheduled for Thursday, May 21, 2015 at the Federal High Court, Lagos.

Two Lagos-based lawyers, Oluyinka Oyeniji and Osasuyi Adebayo, had initiated a class action on behalf of millions of Nigerians who criticised the new subscription rates as exploitative and insensitive.

The duo had sought the order of the court to stop MultiChoice or its agents from implementing the 20 per cent hike in the fees charged subscribers for using the service effective April 1, 2015.

The plaintiffs equally asked the court to compel the National Broadcasting Commission to take steps to monitor and regulate MultiChoice operations in Nigerian to ensure that it does not hike their fees arbitrarily.

The two applicants said they were expecting the NBC to ensure that they compel DSTV to deal with Nigerians the same way DSTV deals with other subscribers in other parts of the continent where MultiChoice operates, by ensuring that the pay-per-view scheme was introduced in the country.

This arrangement, they argued, would ensure that Nigerian subscribers to DSTV would only pay for programmes actually watched, as is the case in South Africa.

Read More: premiumtimesng