Business
Russian shares fall rapidly after U.S. sanction
MOSCOW – On Friday, Russian shares fell sharply as investors took fright at tougher than expected U.S. sanctions against President Vladimir Putin’s inner circle over Moscow’s seizure of Crimea from Ukraine.
The United States added 20 names to its sanctions blacklist, including Kremlin banker Yuri Kovalchuk and his Bank Rossiya, oil and commodities trader Gennady Timchenko and the brothers Arkady and Boris Rotenberg, who are linked to big contracts on gas pipelines and the Sochi Olympics, as well as Putin’s chief of staff and his deputy, the head of military intelligence and a railways chief.
In one immediate consequence, U.S. credit card companies Visa and MasterCard stopped providing services for payment transactions with Russia’s SMP bank, owned by the Rotenberg brothers, the bank said.
President Barack Obama said Washington was also considering sanctions against key economic sectors including financial services, oil and gas, metals and mining and the defense industry, if Russia made military moves into eastern and southern Ukraine.
Diplomats said the mere mention of such a possibility would chill investment in Russia, charging an immediate price for Moscow’s action in Crimea and serving as a potential deterrent to going further.
The EU also extended its personal sanctions to another 12 middle-ranking Russian and Crimean officials.
Though the MICEX share index lurched about 3 percent lower when trade opened, Putin mocked Obama’s announcement of the visa bans and asset freezes on the money men and security officials who accompanied his rise from the mayor’s office in Saint Petersburg in the 1990s.
But he said Moscow should refrain from further retaliation against the United States for now.
Prime Minister Dmitry Medvedev, however, made clear that Russia would step up financial pressure on Ukraine.
He said the former Soviet republic should repay Moscow $11 billion under a gas supply contact that should be scrapped because it no longer applied.
Medvedev said the Kharkiv agreements under which Russia was to provide cheap gas in return for the lease of the Sevastopol naval base in Crimea were “subject to denunciation”, giving Russia a legal right to sue for money back from Ukraine.
Altogether, Kiev owed Moscow $16 billion, he added.
EU LEADERS MEETING
Russia’s parliament rushed to complete ratification of the annexation of the Black Sea region while European Union leaders met in Brussels to discuss steps to reduce their long-term dependence on Russian energy.
The Federation Council upper house approved a treaty on Friday incorporating Crimea into Russia after the State Duma lower house did so a day earlier.
The 28 EU leaders underlined their support for Ukraine’s new leadership, rejected as illegitimate by Moscow, by signing a political agreement with interim Prime Minister Arseniy Yatseniuk and promising financial aid as soon as Kiev reaches a deal with the International Monetary Fund.
The signing “recognizes the aspirations of the people of Ukraine to live in a country governed by values, by democracy and the rule of law, where all citizens have a stake in national prosperity,” European Council President Van Rompuy said at the ceremony. The accord contained no offer of EU membership.
The IMF is to report next Tuesday on advanced talks with Ukraine on a major loan program that would be linked to far-reaching reforms of the former Soviet republic’s shattered economy.
Polish Prime Minister Donald Tusk said the EU leaders were discussing using their collective bargaining power to stop Russia playing off European countries against each other in gas contacts. Up to now, each EU state has negotiated its own deal with Moscow, and some refuse even to share contract details with the European Commission or EU partners.
“We are working hard to make at least one step forward in the area of making community purchases of energy,” Tusk told reporters on arrival for the second day of an EU summit.
“In fact it is all about making the EU stronger as a whole versus energy exporters, so that we have a bigger bargaining power, so that we can act more as a community. In simple terms, it is about common purchases of energy.”
TUG OF WAR
An East-West tug-of-war has mounted since Russia occupied Crimea, home to its Black Sea fleet and a majority of ethnic Russians, following the overthrow of pro-Russian Ukrainian President Viktor Yanukovich by street protests last month.
Three months of protests were triggered by Yanukovich’s refusal to sign an association agreement with the EU, the political part of which was signed on Friday.
The EU leaders agreed to impose asset freezes and visa bans on 12 more mid-ranking Russian and Crimean officials and to consider wider economic sanctions if Russia further destabilizes the situation in Ukraine.
But they said Europe did not have a legal basis to extend the personal sanctions against Putin associates without proof of their direct involvement in the violation of Ukrainian sovereignty.
“Small measures in the EU are worth more than big measures in the United States,” a senior European official said, noting that EU trade with Moscow was 10 times the U.S. volume.
“It’s about cutting off Russia politically and diplomatically,” the official said, dismissing criticism that EU sanctions looked weaker than the U.S. measures.
Russian Deputy Finance Minister Alexei Moiseev said he expected no big immediate impact from western sanctions on Russia’s financial sector.
He also criticized the downgrading of Russia’s credit outlook by leading ratings agencies, saying there was no basis for the move. On Thursday, S&P and Fitch revised to ‘negative’ from ‘stable’ their long-term outlooks on Russia’s debt.
“Our creditworthiness has not changed, of course. We’re going to have a budget this year that will be better than expected,” Moiseev said.
In one glimmer of diplomatic progress, Russian Foreign Minister Sergei Lavrov said an agreement was near on sending a monitoring mission by the pan-European OSCE security watchdog. The EU had threatened to send its own monitors if Moscow continued to block a mandate at the Organisation for Security and Cooperation in Europe.
– REUTERS
The Nigerian stock market ended Wednesday on a bullish note, recording a significant gain of N364 billion for investors, despite concerns over corporate governance as 30 companies were axed from the Nigerian Exchange Limited (NGX).
The market’s positive performance was largely driven by the release of full-year 2024 financial results, boosting investor confidence.
The market capitalisation, which opened at N64.156 trillion, increased by 0.57% to close at N64.520 trillion.
READ MORE: EFCC, NGX RegCo Strengthen Partnership On Market Integrity
Similarly, the All-Share Index (ASI) rose by 591 points, or 0.57%, to settle at 104,549.74 from the previous 103,958.75. This pushed the Year-To-Date (YTD) return to 1.58%.
Despite the market’s overall bullish sentiment, market breadth remained negative, with 38 losers outweighing 27 gainers.
Among the top gainers, Aradel Holdings led the chart with a 10% increase to close at N594, followed by Chellarams Plc (9.98%), Stanbic IBTC (9.92%), UPL (9.64%), and Daar Communications (9.09%).
On the flip side, McNichols and Caverton led the losers’ chart, both dropping 10% to close at N1.44 and N2.07 per share, respectively.
Other notable decliners included Thomas Wyatt (-9.8%), Veritas Kapital (-9.79%), and Consolidated Hallmark Plc (-9%).
Market activity remained robust, with the total value of traded stocks rising by 9.99%. Investors exchanged 421.62 million shares worth N15 billion across 16,256 deals, compared to 542.23 million shares valued at N13.636 billion in the previous session.
Universal Insurance dominated the volume chart with 33.6 million shares, while Aradel Holdings led in transaction value, recording N6.3 billion in trades.
Amid the market rally, the NGX took a decisive step in enhancing corporate governance by delisting 30 companies over compliance failures.
The NGX Regulation Limited (NGX RegCo), the independent regulation subsidiary of Nigerian Exchange Group (NGX), and the Economic and Financial Crimes Commission (EFCC) have called for enhanced partnership to enhance market surveillance and combat financial crimes in Nigeria’s increasingly digitalized capital market.
This strategic initiative was discussed during a high-level meeting between NGX RegCo’s Chief Executive Officer, Olufemi Shobanjo, and EFCC’s Executive Chairman, Ola Olukoyede, at the Commission’s Abuja headquarters on Tuesday, January 28, 2025.
During the meeting, Shobanjo highlighted the critical need to adapt regulatory frameworks to address sophisticated digital financial crimes emerging in today’s evolving market landscape. “The digitalization of our markets has brought new challenges, necessitating a more robust collaborative approach,” he stated. “While our 2013 MoU established initial cooperation parameters, the substantial market growth in 2024 demands an enhanced partnership framework. As a frontline regulator, we recognize the EFCC’s crucial role in providing enforcement support and specialized expertise to combat market abuse and protect investor interests.”
ALSO READ: Dangote Imports 12m Barrels Of Crude From United States
Shobanjo emphasized NGX RegCo’s dedication to maintaining market integrity and expressed confidence that reinforced collaboration with the EFCC would strengthen investor protection mechanisms.
Responding, Olukoyede commended the desire to strengthen the existing relationship between the two agencies and assured that the Commission was ready and willing to collaborate.
“I know you are also concerned with regulatory compliance because the issue of compliance is a key issue. It is part of our mandate to enforce compliance. Under my administration, we have strengthened our bond with different regulatory bodies. Let’s see how we can have a desk where we can work better and attend to you. I have a special interest in the capital market in respect of the abuse of assets and trades. We will try to review the MoU, make our observations in line with the relevant laws and regulations, and communicate our views to you. We pledge our commitment to this”, he said.
The strategic dialogue highlighted both organizations’ shared commitment to fostering a secure, transparent, and globally competitive Nigerian capital market that instils investor confidence and promotes sustainable economic growth.
In the bid to boost local refining of petroleum products, the Dangote Petroleum Refinery has placed orders for up to 12 million barrels of crude oil from the United States.
Biztellers gathered that the refinery resorted to crude importation because local supply challenges was threatening the new $20bn refinery’s push to reach full refining capacity.
Recall that the refinery plans to reach its 650,000 barrels per day capacity in June this year.
ALSO READ: FewChore Finance Backs Osun SDG Creatives With ₦500m
Reliable sources at the Dangote Refinery maintained that low local crude supply from the Nigerian National Petroleum Company Limited (NNPC Ltd) had become a challenge to this plan to ramp up daily production.
The 12 million barrels of crude were already on the way from the United States and expected to land in Nigeria next month, according to the African Report.
“About 12 million barrels of crude have departed the US and should arrive in Nigeria by February,” an insider source told The Africa Report.
Dangote Petroleum Refinery is said to be importing more crude oil as supply from the NNPC becomes insufficient for fuel production at the $20bn Lekki-based facility.
Officials at the plant said the facility has ramped up production to about 500,000 barrels per day, with the target of hitting the 650,000bpd mark by June this year.
The NNPC Ltd is reportedly struggling to supply 350,000bpd to the Dangote refinery from the 450,000bpd crude meant for Nigeria’s local consumption.
With its current production capacity of 500,000bpd, officials said there is a need to look beyond the shores of Nigeria for the feedstock.
Recall that in July 2024, President Tinubu ordered the NNPC Ltd to sell crude oil to local refineries in naira.
According to the crude oil production forecast of producing oil companies and the refining requirement of functional refineries in Nigeria signed by the Chief Executive of the Nigerian Upstream Petroleum Regulatory Commission, Gbenga Komolafe, the Dangote refinery would require 550,000 barrels of a blend of Nigerian crude oil daily, 17.05 million barrels monthly, and 99.55 million barrels between January and June 2025.
The Dangote Refinery is already building eight more tanks to store imported crude. The facility is planning to stockpile imported crude oil because local supplies have become unreliable.
Officials of the refinery were quoted as saying that low crude supply from the NNPC Ltd “is driving import dependence.”
The building of eight additional tanks will see crude storage capacity at the refinery jump by 41.67 per cent to 3.4 billion litres.
“Importing crude from other countries instead of buying locally means that our crude stockpiles will have to be higher,” the Vice President in charge of the oil and gas business at Dangote Industries, Devakumar Edwin, said.
In May 2024, the refinery reportedly issued a term tender for the purchase of two million barrels of West Texas Intermediate Midland crude monthly for 12 months starting in July last year, amounting to 24 million barrels of crude in one year.
NCDMB ES, SPDC Officials Visit Brightwaters Energy, Laud Firm’s Capabilities for Industry Projects
NGX Records N364bn Gain In Bullish Market Performance
BREAKING: EFCC Arrests Former NHIS Boss, Prof. Usman Yusuf
JAMB Suspends Law Programme Admissions At Eight Universities
NLC Declares Nationwide Protest Over Telecom Tariff Hike
Court Adjourns Ruling On Sowore’s Bail Application
OSSG Raises Alarm Over Murder Plot By APC Chieftain
NCC, SMEDAN, NAICOM, SEC, Others Set for SUPERNEWS SMEs Conf June 13
Sahara’s Tonye Cole resigns from GPHCDA
Niger Delta Avengers: President Buhari Reads riot Act …considers the carrot and stick option
Oando opens ultra-modern petrol station in Lagos
