The naira depreciated against the US dollar on Wednesday at the official market amid heightened demand for foreign currency. Data from the Nigerian Foreign Exchange Market (NFEM) showed the naira closing at N1,494 per dollar, weaker than N1,484 recorded a day earlier. During intraday trading, the naira touched a high of N1,498 before settling slightly lower.
Analysts attributed the dip to pressure from increased demand for the greenback by market participants amid limited supply. However, they maintained that the Central Bank of Nigeria (CBN) remains positioned to support the market, noting that the outlook for the naira in 2025 is buoyed by global dollar weakness.
Meanwhile, Nigeria’s foreign reserves climbed to $41.899 billion, supported by steady inflows, especially from crude oil exports. Analysts expect the reserve level to rise further by the end of the week, despite fluctuations in global oil prices.
Oil markets came under renewed pressure after the American Petroleum Institute (API) reported a 3.4 million-barrel decline in US crude inventories, against expectations of a 1.07 million-barrel build. Gasoline inventories dropped by 700,000 barrels, while distillate stocks rose by 1.9 million barrels, sending mixed signals about US energy demand.
At the same time, geopolitical tensions re-emerged as Ukraine claimed responsibility for an attack on Russia’s Saratov refinery, which processes up to 140,000 barrels of crude daily. Analysts suggest the development may create a price floor for crude, stabilizing global markets.
