Nigeria’s Oil Industry Receives $2.9bn CBN Allocation

The Central Bank of Nigeria has disbursed a total of $2.97 billion to oil industry participants for the import of petroleum products and other associated items into the country.

The amount released between 2022 and the first quarter of 2024 comes against the backdrop of Nigeria’s considerable energy crisis, fuel shortages, and marketers’ insistence on continuing fuel imports despite the availability of petrol from Dangote Refinery.

Fuel imports, which consume a substantial amount of foreign cash, have an impact on the country’s foreign reserves and the naira-dollar exchange rate.

Wale Edun, Minister of Finance and Coordinating Minister of the Economy, announced on Thursday that the country now has a net inflow of around $2.35 billion into the Central Bank’s foreign reserves. Nigeria’s external reserves are presently at $37.24 billion as of September 17, 2024.

A breakdown utilizing the quarterly data report for the first quarter of 2024 revealed that the apex bank released $1.41 billion in 2022 for gasoline imports. In 2023, the figure fell to $1.03 billion, a 26.9 percent dip.

In the first quarter of 2024, the bank allocated a total of $522.9 million, representing 0.01 percent of the $4 billion spent on imports during the time under review, but a 12.86 percent increase over the $463.3 million recorded in the preceding period of 2023.

The CBN’s data on sectoral utilisation for transactions valid for forex revealed that $173.88m was utilised in January 2023 for fuel imports; $137.67m in February, and $151.75m in March.

Forex for fuel import transactions fell to $132.36m in April and $ 117.92m in May but rose to $89.85m in JuneThe country utilised $45.82m in July and zero dollars in August for petroleum products importation. The apex bank said $42.43m was used for fuel imports in September, $38.46m in October, $51.95m in November and $52.14m in December.

In the second quarter of 2024, the National Bureau of Statistics said the value of Nigeria’s import of PMS rose to N3.22tn – the highest on record in the nation’s history. It added that the importation of petrol in the second quarter of 2024 constituted 25 per cent of total imports in the period.

Furthermore, the N3.2tn petrol import bill in Q1 2024 marks a 100 per cent increase in the value of petrol import compared to the same period of 2023 which stood at N1.6tn. In the first quarter of 2024 so far, the value of petrol imports reached N2.6tn while cumulatively in the first six months of the year, the country’s petrol import bill stood at N5.8tn.

When compared to the same period of 2023, the country’s petrol import bill has increased from N3.1tn to N5.8tn. This denotes an increase of 87.09 per cent during the period.