Increase In Fuel Price Crushes Naira To N345/$1

 

The Nigerian naira suffered a setback on Thursday, crashing to N345 against the dollar, following the federal government’s decision to liberalise sales of petrol.The naira also exchanged at 475 to pounds less than 24 hours after the announcement was made by Ibe Kachikwu, minister of state for petroleum.

A bureau de change operator in Lagos where the dollar closed at N345 to the naira, told TheCable that many sellers were stranded.

“If you want to buy, we don’t have to sell, but if you want to sell, we can discuss,” Isiaka Mohammed, a trader, told TheCable in Lagos.

“We sold for 345 today, but many of us don’t have again to sell. If you want to buy now, you would not see to buy,” he said.

In Abuja, an operator said trading at the parallel market closed at the rate of 345 to the dollar, as against 322 to the dollar early Wednesday when the new pump price had not been introduced.

“We don’t understand how this is going, we closed market at N340 to the dollar, while pounds sold at 475,” he said.

The situation was the same in Kano. An operator in the state, said the dollar was selling for 325 in the afternoon, but is currently trading around 330.

With prevailing realities, the nation may be forced to devalue the naira, as round tripping is likely to persist in the days ahead.

Oil industry insiders had initially told TheCable that they would now have to source foreign exchange for importation of petrol from the parallel market, as the Central Bank emphasised lack of forex.

“All oil marketers will be allowed to import PMS on the basis of forex procured from secondary sources and accordingly PPPRA template will reflect this in the pricing of the product,” a source said.