Federal Government is expected to generate $4 billion annually from trading about 50 million barrels on Nigeria’s commodities exchange.
The exchange plans to offer crude oil and gas trading to deepen access to financing for the industry that’s the biggest foreign-exchange earner for the nation.
The Lagos Commodities and Futures Exchange is working with the Securities and Exchange Commission(SEC), to meet trading requirements after obtaining guidance from the Abuja-based agency, the chief executive officer(CEO), Akinsola Akeredolu-Ale said.
The consideration is that 10 to 20 per cent of Nigeria’s crude oil production be provisioned for trading on the floor of the Lagos Commodities and Futures Exchange,’ he said in an interview, without being drawn on when it would start.
It will be the first time the fossil fuel will be traded on an exchange in Africa’s largest oil producer.
Oil production, last month, averaged more than 1.4 million barrels per day, with the bulk exported directly to foreign buyers and the rest sold to local refiners.
Nigeria has for years been unable to meet its OPEC+ quotas, partly because of underinvestment in the industry, crude oil theft and vandalism.
A recovery in the industry is vital for President Bola Tinubu to achieve his long-term economic growth target of 6 per cent or more in the coming years. Growth slowed to 2.7 per cent in 2023 from 3.1 per cent a year earlier.