Oil Extends Gains, Naira Fights Back At US Dollar As CBN Reduces Interest Rate

Oil prices climbed for the second straight day on Wednesday following the Central Bank of Nigeria’s (CBN) decision to cut its benchmark interest rate by 50 basis points, from 27.5 per cent in July to 27 per cent.

According to Channels Television, as of 5:00 AM WAT on Wednesday (today), Brent crude futures rose 19 cents, or 0.3 per cent, to $67.82 a barrel.

Naija News understands that the benchmark had already gained more than $1 per barrel on Tuesday after a deadlock stalled Iraq’s Kurdistan oil exports through Turkey.

Two major producers had insisted on debt repayment guarantees before resuming shipments.

Industry data also pointed to a decline in U.S. crude inventories last week, reinforcing market concerns about tightening global supplies.

Naira Appreciates in Official Window

The naira gained slightly at the official market on Tuesday, appreciating to ₦1,487.36 per United States (US) dollar from ₦1,488.60 on Monday, according to CBN figures.

This represented a 0.08 per cent marginal increase.

In the parallel market, however, the local currency held steady at ₦1,515 per dollar, street traders confirmed.

The CBN’s decision marks the first interest rate cut in five years, described as a cautious pivot in monetary policy as inflation shows consistent signs of easing.

CBN Governor Speaks

At a press briefing on Tuesday, CBN Governor Olayemi Cardoso said the move was aimed at stimulating growth while keeping inflation in check.

“Our monetary stance reflects confidence that inflationary pressures are easing. The aim is to support investment and consumption without undermining stability,” he said.

Naija News reports that beyond Nigeria, global supply disruptions also kept oil prices elevated. Shipments from Russia remain limited, while in Venezuela, U.S. oil giant Chevron confirmed it could only export about half of the 240,000 barrels per day it produces with local partners.

U.S. data showed crude stocks declined by 3.82 million barrels in the week ended September 19. Gasoline inventories fell by 1.05 million barrels, while distillate inventories rose by 518,000 barrels, according to Reuters.

Despite global supply tightness, Nigeria recorded an increase in output. According to the National Bureau of Statistics (NBS), the country’s daily crude oil production rose to 1.68 million barrels per day in Q2 2025, the highest quarterly level since 2022.

Figures from the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) also showed production averaged 1.71 million barrels per day in July 2025, a 9.9 per cent year-on-year rise. This included 1.507 million barrels of crude oil and 204,864 barrels of condensates.

The naira had already shown resilience the previous week, appreciating by 0.91 per cent week-on-week to close at ₦1,487.90 per dollar in the official market, a gain of ₦13.60.

A research note by Coronation Merchant Bank attributed the performance to sustained CBN interventions and steady foreign portfolio inflows.

In the parallel market, the naira also gained, appreciating by 0.66 per cent week-on-week to settle at ₦1,525 per dollar.