The price of Bonny Light, one of Nigeria’s crude grades, has dropped to about $12 – $13 a barrel this week. The price is $15 lower than the value of the global benchmark if crude oil, Brent crude, which stands at $28, as on Friday.
The development means that the current selling price is below the cost of production for Nigerian crude producers, which is estimated at $22 and the budgeted crude benchmark of $30 per barrel.
It appears the record supply cut by the Organisation of Petroleum Exporting Countries (OPEC) and its allies (OPEC+) could not save the crude, as the value dropped due to closure of industries across the world.
The global lockdown implemented by world leaders to contain the coronavirus pandemic has led to the closure of factories and refineries and in turn, a drop in global demand.
For instance, a large part of Europe, that constitute the major market for Nigeria, has gone into lockdown mode to combat the COVID-19 pandemic. In addition, even with lower oil prices, long-haul buyers from Asia do not want oil cargoes because there are also shipping costs to pay and no real need for the oil barrels since demand has plunged.
For Africa’s largest economy, this could become a big challenge, since the country has extraordinarily little storage tanks to keep its unwanted crude. According to IHS Markit, Nigeria will run out of storage space quickly if it doesn’t find ships to take its oil.
While a semblance of Nigeria’s critical condition is playing out across the globe, with oil cargoes often trading at huge discounts to crude oil contracts, the pain is extremely awful for Africa’s largest economy due to its heavy reliance on oil. Nigeria relies on crude sales for about 60% of government revenues and 90% of foreign exchange earnings.
Nigerian National Petroleum Corporation stated, ”The market is simply responding to the forces of demand and supply precipitated by the COVID-19 pandemic. We are working diligently to guarantee a steady market for our crude in the short and long term.”
#EndSARS: NCAA denies alleged shut down of airspace, as Turkish Airlines takes off tonight
FAAN has reportedly shut down the air space of the nation due to alleged unrest in the country.
The Nigerian Civil Aviation Authority (NCAA) has denied the alledged shut of the nation’s airspace due to the unrest, arising from the hijacked #EndSARS protests in Lagos, Abuja, and some other states in the country.
Though, the authority has not issued an official statement on the development, a source in the apex regulatory body told Nairametrics that the airspace remains open in Lagos and Abuja.
He said, “It is not true that the airspace is shut as rumoured on some social media platforms. Turkish Airline is attending to its passengers at the moment and the flight is tonight. So, where is the airspace being shut coming from.
“Delta Airline decided to divert the Lagos bound flight to Dakar, Senegal before going back to New York not because our airspace is shut but its Lagos office informed the Pilot that there is curfew in Lagos. Expectedly, American airlines are so sensitive to issues like that.”
Back story: A Twitter user, Osasu Onayiuwana, whose friend is one of Delta Air passengers en-route Lagos from Atlanta, USA, had alleged that Delta Airline returned ti New York because Nigerian air space was shut.
He tweeted, “A friend returning to Lagos, from Atlanta on @Delta has been informed, during their Dakar, Senegal stopover, that @Nigeria’s airspace has been closed. They are now flying back to Atlanta!
“Actually, his plane is currently on the way to New York, from Dakar. Before this, some passengers asked @Delta to allow them to find their way to Lagos from Dakar. Understandably, the airline refused.”
— Osasu Obayiuwana (@osasuo) October 20, 2020
FRC to implement new IFRS 17
The FRC is set to implement International Financial Reporting Standard 17 (IFRS) on or before January 2023.
The Financial Reporting Council of Nigeria is expected to implement International Financial Reporting
Standard 17 (IFRS) on or before January 2023. This follows the amendment of the standard on June 25, 2020.
This was disclosed by the Head, Directorate of Accounting Standards Public Sector, FRC, Dr. Iheanyi Anyahara, during a Stakeholders interactive forum with FRC and International Accounting Standards Board (IASB) webinar recently.
Nigeria adopted the IFRS as part of measures to improve transparency, reporting practices and full disclosures.
Having adopted the IFRS by the Council, Anyahara explained that all amendments to existing standards alongside the new standards issued by the International Accounting Standards Board (IASB) must be implemented by all reporting entities in Nigeria.
According to him, the Council is aware that implementing IFRS 17 commands a radical departure from current accounting standards and produces complex operational challenges.
He said, “That is why we are organizing this programme and many more in collaboration with IASB to guide the users of the standards both in application and implementation.
“The Council will be organizing more events in financial reporting, auditing and corporate governance in order to sensitize the general public and lessen the knowledge gap in IFRS standards in Nigeria in collaboration with relevant agencies and organisations.”
Last July, Nairametrics reported when FRC released guidelines for reporting in compliance with the Nigerian Code of Corporate Governance. (NCCG 2018).
In a statement posted on its website, the Council explained that it had been engaging with all regulators of sectors for the purpose of developing sectoral guidelines of corporate governance on specific requirements relevant to each sector, which are not covered under NCCG 2018.
Geely Auto to invest 54 million dollars in the development of healthy cars
Geely’s leading track record will be taken to a new level with the development of an all-round “healthier car.”
As Exclusive Partner of Geely Automotive in Nigeria, Mikano brings us great news of Geely Automotive innovative steps towards development of “healthy, intelligent vehicles” by earmarking 54 million Dollars of funding to it; as a furthering of the fight against Coronavirus.
The move not only adds a new dimension to Geely’s understanding of “passenger safety,” it also represents a new development direction for automobiles.
The development of a “healthier car” differs from specialized medical vehicles in that Geely’s products are made for ordinary consumers. Cars with comprehensive virus protection not only require the capability to isolate harmful substances in the air, it also needs to quickly and effectively purify cabin air for occupants.
Geely Auto’s global R&D and design networks based in Europe, USA and China will jointly move to develop and research new environmentally sustainable materials with anti-bacterial and anti-viral properties which can be used within air-conditioner systems and on frequently touched surfaces such as buttons and handles.
Geely Auto will make full use of its global R&D system and resources as well as cooperate with professional medical and scientific research institutions to set up special project teams to work on the new research.
An Conghui, President of Geely Holding Group and President and CEO of Geely Auto Group said “Epidemic prevention is a job that requires the long-term effort of wider society. As the most common mode of transportation, consumers spend a considerable amount time in their cars, akin to a “second home” Only by making healthier products can we meet consumer demand for better quality of life. Based on the automotive industry’s development direction built around electrified, connectivity, intelligence, and shared mobility, auto companies should commit to developing products that help protect the health of drivers and passengers. This will become one of Geely Auto key long-term development objectives.”
Earlier on January 28, Geely Holding Group joined hands with the Li Shufu Foundation to set up a special 30 million dollars fund in support of the new coronavirus prevention and control, with a focus on the mass purchasing of much needed medical supplies for China in the short term.
Geely’s leading track record will be taken to a new level with the development of an all-round “healthier car.” Geely’s move sets a new precedent in the development of safety technologies that goes beyond developing leading crash test results and moves into new dimensions of passenger safety.
Visit www.geely.ng to find out more about Geely Nigeria