Latest data from the Central Bank of Nigeria (CBN) shows that the nation’s external reserves pool fell further, just as oil price continued to tumble owing to the slowdown in demand fueled by the Coronavirus pandemic across the globe that has resulted in a significant drop in demand for crude oil, the nation’s mainstay, even as its price has fallen afar from the 2020 benchmark price of $57 per barrel.
A review of the CBN data showed that the nation’s reserves dropped by $1.32bn or 0.37% Month-t-Date, from $35.164bn at the end of March to $33.843bn as of Thursday, April 16, 2020.
This increased the rate of decline, Month-on-Month to April 16) to $2.17bn or 6.03% from $36.018bn on March 17; following which the nation’s reserves level has dropped by $4.751bn or 12.31% year-to-date, from $38.595bn recorded on December 31, 2019.
This is just as oil prices tumbled further on Friday amidst news of plans by U.S President Donald Trump to ease his country’s Coronavirus lockdown to get the American economy moving again were reportedly overshadowed by China’s worst quarterly economic contraction on record. China’s GDP suffered a 6.8% year-on-year slump in the first quarter, hit by the shutdown of its thriving manufacturing sector hit by the COVID-19 crisis.
Brent crude rose 44 cents to $28.26 per barrel, while the U.S. crude contract for May tumbled $1.60, or 8.1%, to $18.27, attributable to the imminent expiry of the contract, on April 21, and fast-filling crude storage.
The Organization of the Petroleum Exporting Countries (OPEC) and producers including Russia, a grouping known as OPEC+, agreed to cut production by nearly 10mbpd last weekend after an earlier oil supply pact collapsed.