In Six Months, Oil Imports Gulped $770.58m – CBN
A total of $770.58m was utilised for oil imports in the first half of this year, the latest data from the Central Bank of Nigeria have shown.
The CBN’s data on sectoral utilisation for transactions valid for foreign exchange revealed that $148.32m was utilised in January; $145.23m in February, and $139.55m in March.
Forex for transactions in the oil sector fell to $113.80m in April and $109.11m in May but rose to $114.57m in June.
Oil imports accounted for about 4.35 per cent of the $17.70bn utilised for imports in the country from January to June, according to the CBN data.
The amount of foreign currency used for imports in the country stood at $3.98bn in January; $4.98bn in February and $5.36bn in March. It plunged to $1.08bn in April and $1.06bn in May but rose to $1.24bn in June.
The nation’s forex reserves had been on a downward trajectory for months until recently, falling to a record low of $33.42bn in April 2020 from a high of $45.18bn in June 2019.
The reserves stood at $35.79bn as of September 14, 2020, according to the CBN.
The CBN Governor, Godwin Emefiele, at the Monetary Policy Committee meeting in March, said, “The depletion in forex reserves was driven by forex sales to the Bureaux de Change and the investors’ and exporters’ forex window, as well as dwindling oil receipts.”
The Nigerian National Petroleum Corporation has been the major importer of petroleum products into the country in recent years.
Despite the recent petrol deregulation, most marketers have yet to resume petrol importation due to a lack of access to forex at the official rate.
“For the purpose of establishing Letters of Credit and Bills for Collection for the importation of petroleum products, authorised dealers shall forward to the Director, Trade and Exchange Department (of the CBN), all relevant supporting documents for consideration prior to commencement of the transaction,” the central bank said last week in its monetary, credit, foreign trade and exchange policy guidelines.
It added, “Furthermore, the CBN shall be notified within 48 hours by the authorised dealers before bidding for funds to pay for such transactions.”
Nigeria, Africa’s largest oil producer, relies largely on importation for petrol and other refined products as its refineries have remained in a state of disrepair for many years.
The refineries, located in Port Harcourt, Kaduna and Warri, have a combined installed capacity of 445,000 barrels per day but have continued to operate far below the installed capacity.