Business
Oil falls as China’s economic recovery disappoints, dollar strengthens
Oil fell above one dollar on Wednesday due to the economic growth in China the world’s second-largest crude user.
There were slightly missed expectations, raising concerns about future demand, while U.S. dollar strength dented investor’s risk appetite.
Brent crude futures fell 1.26 dollars (1.6 per cent) to 77.03 dollars per barrel by 1158 GMT. U.S. West Texas Intermediate crude futures (WTI) were down 1.35 dollars (1.9 per cent) at 71.05 dollars.
Even the ongoing naval and air conflicts on the Red Sea were not enough to support oil.
Regardless of the concerns, tankers have to pause or reroute, increasing shipping costs and slowing down deliveries.
In the fourth quarter, China’s economy expanded by 5.2 per cent year-on-year, missing analysts’ expectations and calling into question forecasts that saw Chinese demand fuelling 2024 global oil growth.
Priyanka Sachdeva, a senior market analyst at Phillip Nova reported that the economic data “doesn’t end the headwinds over crude oil demand, the Chinese outlook for 2024 and 2025 is still bleak,”
The oil industry-backed the notion that despite a bumpy recovery, oil demand from China has been resilient and will likely reach record levels in 2024.
Still, China’s oil refinery rose 9.3 percent to a record high throughout 2023, indicating elevated demand though it lagged some analysts’ expectations.
Other signs of steady Chinese demand appeared.
Additionally, the U.S. dollar hovered near a one-month high on Wednesday after comments from Federal Reserve officials lowered expectations for aggressive interest rate cuts. A stronger dollar reduced the demand for dollar-denominated oil from buyers using other currencies.
Sachdeva said, “Higher rates can lead to a weaker outlook for oil demand as economic activity tends to cool in a high interest rate environment, leaving oil prices vulnerable.”
In the U.S. oil refiners are expected to likewise have 1.5 million barrels per day (bpd) of capacity offline for the week ending Jan. 19.
Research company IIR Energy said on Wednesday that there was a decrease in the available refining capacity by 954,000 barrels per day.
In the Red Sea, tensions remained high as the U.S. on Tuesday mounted fresh strikes against Iran-aligned Houthi militants in Yemen after a Houthi missile hit a Greek vessel.
Vivek Dhar, mining and energy commodities strategist at the Commonwealth Bank of Australia, wrote in a note, “While oil benchmarks may not reflect the Red Sea attacks, the realised price for oil and oil products for consumers had increased given the disruption to trade flows through the Red Sea and Suez Canal,” (Reuters/NAN) (www.nannews.ng)
By Abubakar Yunusa
The Association of Labour Veteran and Trade Union Assembly has voiced its support for President Bola Tinubu’s economic reforms, claiming that food prices have significantly decreased across the country.
In a statement issued on Thursday, the union’s interim president, Comrade Isa Tijjani, acknowledged the initial economic hardship faced by Nigerians at the beginning of Tinubu’s administration but insisted that government efforts had led to tangible improvements.
“At the start of this administration, the cost of food soared, and the nation was filled with cries of hunger and complaints. People were urged to be patient as the government worked towards solutions,” Tijjani said.
“Now, the President and his aides have worked tirelessly, and prices have come down drastically. However, I have yet to hear words of appreciation for their efforts. Recognising their achievements will encourage them to do even more for the nation.”
Tijjani, a former national vice-president of the Nigeria Labour Congress, urged Nigerians to differentiate between constructive criticism and unwarranted opposition.
He emphasised that engaging with the government in a respectful and solution-oriented manner would yield better results than resorting to hostility.
“The President of this country today is Alhaji Bola Ahmed Tinubu. Advising him in a humble and respectful manner will be more productive than adopting a confrontational stance. Constructive engagement achieves more than threats and name-calling,” he added.
Tijjani also condemned the recent act of violence in Edo State, describing it as a cowardly attempt to incite division and instability in Nigeria.
He welcomed the swift response of both the President and the Governor of Edo State in addressing the situation and called for the perpetrators to be brought to justice.
The labour leader further urged union members to participate in the upcoming General Executive Council meeting, where the union’s position on national issues will be formalised and disseminated at all levels of governance, from the state to the local and ward levels.
The Tinubu administration has faced criticism over the country’s economic challenges, including inflation and currency depreciation. However, government officials have maintained that their policies will yield long-term benefits for Nigeria’s economy.
Sterling Bank has announced the removal of transfer fees on all local online transactions.
The move was confirmed by the bank on Tuesday in a press release.
The development makes it the first major Nigerian bank to eliminate the contentious charges for digital banking.
The statement noted that the bank reaffirmed its commitment to customer-centric banking, declaring that the zero-transfer-fee policy is real and effective immediately.
The initiative is expected to bring significant relief to individuals and small business owners who conduct frequent transactions.
The bank’s Growth Executive in charge of Consumer and Business Banking, Obinna Ukachukwu, described the decision as a values-driven approach aimed at ensuring fair and inclusive banking.
“We believe access to your own money shouldn’t come with a penalty.
“This is more than a financial decision—it’s about redefining banking to put customers first,” he stated.
Under the new policy, Sterling customers will not be charged for local transfers conducted via the bank’s mobile app.
Ukachukwu emphasised that the bank’s decision is about more than just competitive strategy.
He said, “We’re not yet the biggest bank in Nigeria, but we’ve been the boldest.
Sterling fearlessly believes in the future of Nigeria, and this is us backing Nigerians with more than words.
The Central Bank of Nigeria dismissed a report claiming it had introduced N5,000 and N10,000 banknotes to facilitate cash transactions as false.
In a statement posted on its official X handle on Wednesday, the apex bank described the report as fake and urged Nigerians to disregard it.
“The content is not from the Central Bank of Nigeria. Kindly note that the official website of the CBN is cbn.gov.ng,” the statement read.
A statement from the CBN’s communications department further clarified, “The only official sources for releasing statements to the media are our website or statements from our department. There is also no Deputy Governor by such name. We are investigating the source of this fake content.”
The report quoted one Deputy CBN Governor, Ibrahim Tahir Jr., the move is aimed at reducing cash-handling costs and providing Nigerians with more efficient means of conducting large transactions.
“The introduction of these new high-value denominations aligns with global best practices and will enhance economic activities while reducing the stress associated with carrying large amounts of cash,” the Governor stated. The CBN said there is no such name in its leadership.
“The new N5,000 note will feature the portrait of Chief Obafemi Awolowo, while the N10,000 note will showcase Dr. Nnamdi Azikiwe, both in recognition of their contributions to Nigeria’s development.
“Additionally, the new notes will incorporate enhanced security features, including color-changing ink, holograms, and anti-counterfeiting technology, making them impossible to replicate,” the fake report stated.
The fake report also said the nationwide rollout would begin on May 1, 2025, with commercial banks instructed to start issuing the new notes via ATMs and over-the-counter transactions.