The nation’s foreign reserves on Monday rose again by 0.21 percent to close at $27.49 billion from $27.44 billion as at January 19, 2017, according to data obtained from the website of the Central Bank of Nigeria (CBN).
The increase in foreign reserves is attributable to the rise in oil prices. The Brent crude prices averaged $55.9pb between the 3rd and 16th of January. This is a 2.95 percent increase from December’s average of $54.3pb. Prices have stayed above $50pb throughout 2017, and closed the period at $55.4pb on January 16th. Current prices are 86.5 percent higher than a year ago of $29.7pb on January 15th; this is approximately 100 percent lower than 2016’s lowest price level of $27.72pb on January 21 according to a report by, Financial Derivatives Company.
The report said the level of net reserves is significantly lower than published reports. The external reserves level is 5.91 percent lower than 2016’s peak of $28.93 billion and 30.74 percent below 2015’s peak of $34.51 billion.
External reserves have been on the increase since October 21st.This trend is expected towards the end of January as forex inflows gradually gain momentum. Risks to this include stalled or disappointing borrowing plans and further disruptions to Nigeria’s oil production.