CSL Nigeria Daily - 13 June 2025

CSL Nigeria Daily - 13 June 2025
(Source: CSL RESEARCH, Date: 13-Jun-2025)

Dear Esteemed Client,

Ministry of Finance denies collapse of US$5 billion oil-backed deal; CBN dismisses extension report on BDC deadline

The Ministry of Finance has dismissed recent media claims suggesting that the proposed US$5 billion oil-backed loan from Saudi Arabia's Aramco has collapsed. In a public statement, the ministry labelled such reports as ...unfounded," stressing that negotiations remain ongoing, and that no final decision has been reached to terminate the deal. While this clarification underscores the government's commitment to pursuing strategic oil-linked financing as part of its broader fiscal and economic agenda, it also reflects the mounting pressure on public finances. In our view, this reinforces the likelihood that the fiscal deficit for the year could edge closer to 6% of GDP, against budget expectations of 3.9%, as authorities seek alternative funding sources to bridge persistent revenue shortfalls and meet the augmented expenditure plan.

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Media Highlights:

Petrol imports drop by N2tn as domestic production improves

Nigeria's petrol import bill fell significantly in the first quarter of 2025, dropping to N1.76tn from the N3.81tn recorded in the same period in 2024, representing a difference of over N2tn. According to the latest foreign trade statistics report released by the National Bureau of Statistics, this represents a 54 per cent year-on-year decline. The sharp fall also reflects a 47 per cent reduction from the fourth quarter of 2024, when petrol imports stood at N3.3tn. The decline has been largely attributed to increased domestic supply from the Dangote Petroleum Refinery, which has been ramping up operations in the country. The refinery's growing contribution is beginning to displace foreign petrol suppliers and reduce Nigeria's long-standing dependence on imported refined fuel. Read more here

NNPCL remits N4.2tn to govt, continues refinery upgrade

The Nigerian National Petroleum Company Limited on Thursday revealed that the total statutory payments it made to the federation account between January and March amounted to N4.22tn, adding that refinery upgrades and assessments were ongoing. NNPCL further disclosed that it generated a total revenue of N5.89tn from operational activities in April 2025. The firm, in its first official financial report under the current leadership, said it posted a profit after tax of N748bn within the same period. The report highlights the company's operational performance, financial results, and strategic initiatives aimed at boosting Nigeria's oil and gas sector. It also disclosed the plan to achieve final investment decisions on four projects in the upstream segment by the fourth quarter of the current year. Read more here"‹

China offers Nigeria, others duty-free market access

In a major policy shift set to reshape Africa-China trade relations, the Chinese government has announced plans to grant Nigeria and 52 other African nations full duty-free access to its vast consumer market. The new trade initiative, disclosed by President Xi Jinping in a letter to African foreign ministers, will extend zero-tariff treatment to 100 per cent of tariff lines for all African countries maintaining diplomatic ties with Beijing. A report by Bloomberg on Thursday said the move builds on a previous policy that benefited only 33 least-developed African nations. It is part of China's broader strategy to deepen economic cooperation with the continent amid intensifying trade tensions with the United States. Read more here"‹

Oil production shrinks again, threatens 2mbpd target

Efforts by the Federal Government to ramp up oil production to over two million barrels per day suffered another setback last month, The PUNCH reports. This was as Nigeria's daily oil production declined again in May, falling from 1.68 million barrels per day in April to 1.65mbpd last month. According to data from the Nigerian Upstream Petroleum Regulatory Commission, crude output dropped from 1.48mbpd in April to 1.45mbpd in May. Recall that the crude production rose from 1.40mbpd in March to 1.48mbpd in April, signalling a boost for the country's ambitious 2.1mbpd oil target. However, the fall in May's daily crude production appears to have eroded the successes recorded in the fourth month, casting a shadow on the country's ability to achieve the 2mbpd target. Read more here"‹