The recent crude oil price rally being witnessed looks like it is going to be sustained. Crude oil appears to be heading for its first back to back weekly gain since the month of February 2020, following some positive outcomes in the oil market.
This is so as the recovery in oil demand and the output cuts from OPEC+ and other top oil producing countries have started to rebalance an oil market that is awash with crude oil.
The oil futures in the New York exchange, which once traded below zero dollar, is around $24 per barrel in Asian trading on Friday. This represents a 20% increase this week. Also, the Brent crude, which is around $30 per barrel, has had a 15% price increase in the last week.
It was reported earlier that Saudi Arabia’s oil giant, Aramco, raised the price for all its crude oil grades to all regions for June, in a move that many analysts see as the start of demand recovery. This also hints that OPEC+ has started to cut production in the aim to stabilize the market.
There are also suggestions that the demand increase is being aided by gradual relaxation of lockdown directives in some big economies globally.
According to a monitored report from Bloomberg, although there is a huge oil glut to clear, the head of commodity research at Goldman Sachs, Jeffrey Currie, said that global oil demand is on an improving trajectory and may even exceed supply by the start of June.
This stabilization of the oil market will be a piece of good news to Nigeria, as the oil price recovery will help boost the country’s revenue and foreign exchange earnings.
Nigeria’s public debt is officially N29.83 trillion
Further disaggregation of Nigeria’s total public debt showed that N9.99trn or 34.89% of the debt was external.
The total public debt stocks of the Federal Government of Nigeria, states within the Nigerian federation, and the Federal Capital Territory (FCT) jumped to N28.63 trillion as of Q1 2020. This is according to a report by the National Bureau of Statistics (NBS) which was released on Friday.
A breakdown of the report showed that the total debt stock of the states as of 31 March 2020 is N4.1 trillion. Meanwhile, these states’ total Internally Generated Revenue (IGR) for 2019 was N1.3 trillion. They also received N2.47 trillion from FAAC.
Note that as always, Lagos State recorded the highest IGR at N398.7 billion. The state also received N117.8 billion in FAAC disbursements and has a total debt stock of N444.2 billion, thereby making up 10.8% of the total debt stock of the states.
On the other hand, Yobe State recorded the lowest debt stock out of all the states with just N29.2 billion. This made up just 0.7% of the total debt stock of the states. Meanwhile, the state generated a total IGR of N8.4 billion in 2019.
Part of the report by the NBS said:
“Nigerian States and Federal Debt Stock data as at 31st March 2020 reflected that the country’s total public debt portfolio stood at N28.63trn. Further disaggregation of Nigeria’s total public debt showed that N9.99trn or 34.89% of the debt was external while N18.64trn or 65.11% of the debt was domestic.
“Similarly, States and FCT domestic debt was put at N4.11trillion with Lagos state accounting for 10.8% of the total domestic debt stock while Yobe State has the least debt stock in this category with a contribution of 0.7%.”
— Dr Yemi Kale (@sgyemikale) July 10, 2020
Meanwhile, the FCT had total debt of N106.8 billion, making up 2.6% of the total debt stock of the states. The FCT also recorded an IGR of N74.5 billion in 2019 and received N71.9 billion in FAAC.
The Federal Government’s total domestic debt stock by Q1, 2020 was N14.5 trillion, with FGN bonds making up 72.5% of the total portfolio followed by treasury bills at 18.24%.
The total public debt stock has risen by 4% since December 2019, as the previous figure stood at N27.4 trillion.
You may download NBS’ Nigerian Domestic and Foreign Debt report by clicking here.
COVID-19: WHO reverses itself based on new discovery about the virus
This admission is coming on the heels of criticisms from experts.
The World Health Organization (WHO) has provided an update on the modes of transmission of SARS-CoV-2, the virus that causes COVID-19, from infected people, based on new scientific evidence.
The WHO on Thursday, formally recognized that the coronavirus can be transmitted indoors by droplets in the air, marking a reversal for the United Nation’s agency.
In a scientific brief, the WHO said that people who spend time in crowded places with poor ventilation are at risk of being infected by the coronavirus as the droplets circulate throughout the air in indoor gatherings.
This admission is coming on the heels of criticisms from experts who have been putting pressure on the UN health agency to update its description of the spread of the virus to include the possibility of airborne infections.
The WHO now admits that transmissions through aerosols, or tiny air droplets, could have been behind outbreaks of COVID-19 that have been reported in some closed environments such as restaurants, nightclubs, places of worship or places of work where people may be shouting, talking or singing.
Apart from refraining from having close contact with infected people and frequent hand-washing, the WHO pointed out that people should avoid crowded places, close-contact settings, and confined and enclosed spaces with poor ventilation.
However, the WHO still focuses more on the spread of the virus by larger droplets that are discharged through coughing, sneezing and singing or from contact with a contaminated surface.
The WHO in its statement said, “Respiratory droplet transmission can occur when a person is in close contact (within 1 metre) with an infected person who has respiratory symptoms (e.g. coughing or sneezing) or who is talking or singing; in these circumstances, respiratory droplets that include virus can reach the mouth, nose or eyes of a susceptible person and can result in infection.”
It also revealed that based on what is currently known, the transmission of COVID-19 primarily occurs from people when they have symptoms and can also occur just before they develop symptoms when they are in close proximity to others for prolonged periods of time. While someone who never develops symptoms can also pass the virus to others, it is still not clear to what extent this occurs and more research is needed in this area.
The UN health agency had previously advised that the spread of the virus through the air is only common when people, mostly health care workers, were involved in medical procedures that produced aerosols, though a lot of evidence has surfaced suggesting that the virus can stay in the air for hours and infect a person when inhaled.
DisCos seek CBN funding for massive roll-out of meters to consumers
This, it was said will help DisCos meet the 2024 deadline which they had committed to.
A Central Bank-funded massive roll-out of meters would expedite the efforts to achieve the full take-off of the proposed Service Reflective Tariff (SRT), Electricity distribution companies (Discos) have suggested.
According to Mr Sunday Oduntan, the Executive Director in charge of research and advocacy at the Association of Nigerian Electricity Distributors (ANED), such funding would help ensure that all electricity customers are adequately metered under the Meter Asset Provider (MAP) regulation.
Oduntan, who said this in a statement to NAN on Friday, also disclosed that it would assist the distribution companies to meet the 2024 deadline which they had committed to, for metering all electricity consumers.
He recalled that Mr Ernest Mupwaya, Managing Director of Abuja Electricity Distribution Company (AEDC), had spoken on behalf of the DisCos at the House of Representatives Public Hearing on the power sector on Thursday.
According to Mupwaya, the Capital Expenditure (CAPEX) provision in Nigeria’s electricity tariff was insufficient to cover the cost of metering customers.
“Over the years, there has been insufficient investment in customer metering, due to inadequate Multi Tariff Order (MYTO) CAPEX and uneconomic tariff. The approved CAPEX for DisCos has never been adequate for comprehensive metering,” he said.
He added that the Discos were requesting CBN to provide funds for emergency mass metering projects since they no longer had a provision in their CAPEX for metering. If approved, the project would be completed within a period of 18 months.
Mupwaya added that the funding was even more necessary since no provisions had been made for metering in the event that the MAP regulation failed.
The first quarter of 2020 had seen an average monthly growth of 75,000 new customers every month, moving the number of metered customers in Nigeria above 10 million, and decreasing the metering penetration from 45.5 percent in January 2017 down to 40.3 percent in March 2020.
“Plugging the metering gap that is in excess of six million meters has been slow because even the recently introduced MAP regulations incorporate inappropriate meter pricing and so, it is not working as NERC/DisCos expected.
“The twin effects of the sudden increase in import duties of 35 percent on meter and NERC’s wrong pricing frustrated the good intentions of MAP” he noted.
He appealed to the government to grant full waivers on the 35 percent increased duty surcharged on meters, until mass metering was achieved, and to fix an appropriate and commercial price on meters.
He added that the cap on estimated billing had discouraged consumers from obtaining meters under the MAP regulation, and urged the NERC to allow Discos go ahead with estimated billing, introducing the capping only after the massive meter roll-out after 18 months.