December sees the Nigerian foreign reserve hit its highest point.
The Nigerian foreign reserve has hit the highest point all year at $36.9billion.
Data provided by the Central Bank of Nigeria (CBN) has shown that as of Thursday, December 14, 2017 the total Nigeria’s foreign reserve is $36.9 billion.
Nigeria’s foreign reserves have recorded a growth of 5.1 percent from December 1 where the total of foreign reserves was recorded as $35.1 billion to December 14, 2017 where it was recorded as $36.9 billion.
According to the CBN, the total amount of foreign reserves on Wednesday, December 13, 2017 was $36.7 billion and grew by 0.4% from the previous day to $36.9billion on Thursday, December 14, 2017.
This is a big improvement as the data from the CBN shows that Nigeria began the year with $26.1 billion in the foreign reserves.
Already, the external reserves of Nigeria has recorded 41.2% increase this year alone.
Also Read: Nigeria’s external reserves to hit of $35bn, all thanks to Oil
Although the government started the year with the aim of a target increase to amount to $40 billion, it may not be possible to meet this target before the end of the year despite the rapid increase seen.
Crude oils role in foreign reserve increase
Crude oil is the major export and foreign exchange earner for Nigeria. In the 2017 budget, the government benchmarked crude oil at $44.5, accruing $13.5 excess on each barrel sold by the country. Basing this estimation on the 1.8 million barrels produced by the country, it would amount to $22.1 million gains for the country.
In September 2017, Nigeria experienced one of the biggest foreign reserve increases as crude oil price hit $58 per barrel, surging the country’s excess crude account by $22. 1 million.
However, when the average oil price was between $100 and $120 Nigeria failed to save like other oil exporting countries hence the near shutdown of the Nigerian economy when the global price crashed to somewhere below $30 in April 2015.
Also Read: How one-day gains in the global oil market push Nigeria’s excess crude reserves by $22.1 million