Amidst OPEC’s announcement to cut oil production by 5 percent, a development that will further push gas prices upward and increase the anxiety of Nigerian residents who are already caught in an economic dilemma resulting from the persistence fall in value of the Naira (recently at all-time low of 490 per dollar on the black market on as at Friday 30th September 2016), the country’s external reserve fell to $24.59bn.
The country’s reserves which stood at $25.45bn last month, according to Reuters has declined 19 per cent in the last one year. Specifically, the reserves fell from $25.8bn on August 16 to $24.8bn on September 16.
The OPEC deal which represents a paradigm shift by Saudi Arabia, which had led the body on a production campaign to force higher cost competitors out of the market.
The event also symbolizes the Saudis willingness to cooperate with rival Iran on issues of common interest to the oil clique, even if they were forced to compromise by running on very low prices.
Back in Nigeria, the CBN’s almost daily interventions at the interbank/official foreign exchange market in recent weeks, as chronic dollar shortage continues to weigh on the economy but a bit of an irony is that although major oil players like Nigeria joined OPEC to safeguard its economic interest which is heavily vested on the oil commodity, the decisions made by the body often results in adverse consequences to the domestic economies of member states.Â