Nigeria’s Foreign Reserves Inch Towards $55bn -CBN Data
Nigeria’s gross external reserves continued to rise, reaching about $55 billion, driven by sustained dollar inflows from various sources and a surge in hydrocarbon revenue.
Latest data from the Central Bank of Nigeria (CBN) showed the foreign reserves printed higher at $54.857 billion, from its August close of $53.806 billion.
Based on the figure, analysts noted that the nation’s foreign reserves increased by $1.051 billion from the beginning of September to date amidst a sharp slowdown in FX intervention.
Nigeria’s foreign exchange market has shown signs of improving over the past year, supported by tighter monetary policy, stronger portfolio inflows, and gradual improvements in oil production.
The market remains optimistic about the foreign reserves outlook due to a significant improvement in refining capacity, which has reduced US dollar expenditure on crude imports.
Nigeria has increased crude oil production at a time when the Middle East conflict keeps per-barrel prices in the global commodity market elevated.
In a research report, PAC Holdings said Nigeria’s oil sector faces a supply-demand imbalance, with rising refining capacity but limited crude supply, posing risks of fuel price volatility and FX pressure.
The investment firm said domestic crude shortages may force reliance on dollar imports, impacting inflation, naira stability, and investor confidence.
Sustained production growth above 2 million barrels per day is crucial for stability and reducing reliance on dollar transactions, PAC said in a research note released in the second half of 2026.
Nigeria’s own crude production, 1.56 million barrels per day in June 2026, its highest level since 2020, remains well short of what a fully utilised domestic refining sector will eventually require.
At a realistic 85% utilisation rate, Dangote’s 650,000 bpd installed capacity alone requires approximately 552,500 barrels of crude per day, roughly 35% of the country’s current national output
Nigeria’s refining transformation will increasingly depend on upstream production rather than installed refining capacity, PAC Holdings said.
“Our base case anticipates gradual production growth, but not enough to fully remove crude-allocation pressures. The naira-for-crude framework is therefore likely to remain in place but face periodic supply constraints and occasional dollar-based transactions.
“The key threshold is sustained production near 2 million barrels per day. Achieving this level would improve feedstock security, preserve export earnings, reduce FX demand in the petroleum sector, and support fuel-price stability.
“Failure to do so would prolong crude-allocation disputes, energy-driven inflation and uncertainty across the downstream market, ” a research subsidiary of PAC Holdings said in the report. Investors Trade 3.25bn Shares Valued at N238bn in Nigerian Market
