Crude oil rises by 2%, ahead of upcoming OPEC+ decision.

Taiwo Adekeye, FMVA

March 4, 2024

Oil prices was up by 2% on Friday as traders awaits OPEC+ decision on supply agreements for the second quarter while also digesting fresh U.S., European and Chinese economic data. Brent futures for May settled rose by 2% to settle at $83.55 a barrel while the April Brent futures contract expired on Feb. 29 at $83.62 a barrel. The U.S. West Texas Intermediate (WTI) for April rose by 2.19% to close at $79.97 a barrel.

South Africa: PMI increases by 8.1%

South African manufacturing activity recovered in February after a steep slump the month before, Purchasing Managers’ Index (PMI) reveals. The seasonally-adjusted PMI surged by 51.7 points in February from 43.6 in January, rising above the 50-point mark indicating expansion. The business activity sub-index and new sales orders performed well in February but still maintaining its negative territory. Africa’s most industrialized economy is battling power shortages and a logistics crisis at its rail and port operator Transnet which have strangled business activity and slowed growth in the economy

Nigeria: CBN withdraws licenses of 4,173 bureau d’change operators

The CBN has revoked the licenses of 4,173 exchange bureaus for non-compliance with guidelines, such as failure to submit transaction returns and pay renewal fees within the specified timeframe and non-compliance with anti-money laundering and terrorism finance regulations. The apex banks resumed dollar sales to the exchange bureaus last week, banning street-trading of foreign exchange and raised minimum capital levels for exchange bureaus to at least 2 billion naira ($1.3 million) under new guidelines released on Feb. 23. This major reforms are aimed at transforming Nigeria’s forex market which has been grappling with chronic foreign exchange shortages.

Tunisia: Tunisia hikes drinking water prices by 16% due to drought

Tunisia has raised its drinking water prices by up to 16%, attributing the decision to a persistent five-year drought. After years of drought, average rainfall was up in recent months but Tunisian dams have only attained 35% of their stock capacity. The North African country imposed a quota system for drinking water last year and has placed a ban on its use in agriculture. Consumers using over 40 cubic meters will face a 12% hike, reaching 1.040 Tunisian dinars ($0.33) per cubic meter, for those using between 70 and 100 cubic meters per quarter, there is an immediate 13.7% increase to 1.490 dinars per cubic meter. Additionally, the most substantial increase applies to those consuming over 150 cubic meters and tourist facilities. Their price per cubic meter has surged by 16%, reaching 2.310 dinars.

India: India Q3 GDP propelled by fall in subsidies

India’s economic growth in the three months through December was much higher than most estimates as a result of sharp fall in key subsidies which boosted the GDP. India’s GDP grew by 8.4% during the October-December quarter, its highest growth in one-and-half years. Additionally, gross value added (GVA), which measures the total value of goods and services produced in the economy and excludes indirect taxes and subsidies, grew by 6.5%. Conclusively, Underlying growth was led by investment, which grew at 10.6% on-year in the third quarter, led by government spending and real estate.

China: China’s factory activity contracts for 5th consecutive months

China’s manufacturing activity in February was down for a fifth straight month, putting pressure on Beijing to roll out more stimulus measures as the parliament prepares for a key annual meeting this week. The purchasing managers’ index (PMI) fell to 49.1 in February from 49.2 in January with a sizeable drop in the output component. It was below the 50-mark indicating a contraction in the economy. However, the world’s second-largest economy has been dealing with sluggish growth, marked by a property crisis, cautious consumer spending, divestment by foreign firms, challenges for manufacturers in attracting buyers, and local governments facing substantial debt burdens.