Naira depreciates as crude oil price falls below $60

The Naira weakened further against major currencies on Monday following a sharp decline in global crude oil prices, which dipped below the $60 per barrel mark. This drop has heightened concerns about Nigeria’s economic stability, given the country’s dependence on oil exports for foreign exchange earnings and budgetary support.

At the official market, the Naira fell to N1,605.63 per dollar, down from N1,602.18 on Friday, representing a loss of N3.45, according to data from the Central Bank of Nigeria (CBN). 

The pressure was also evident in the parallel market, where Bureau De Change operators in Lagos reported that the Naira exchanged at N1,615 per dollar on Monday, compared to N1,610 at the close of trading last week.

The fall in oil prices—triggered by increased OPEC+ supply and a slowdown in global demand—poses a double-edged threat to Nigeria’s fragile macroeconomic framework. Analysts warn that the government may face worsening fiscal deficits and declining foreign reserves, further straining its ability to stabilize the exchange rate and finance critical public expenditures.

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“With Brent crude falling below $60 per barrel, Nigeria’s already stretched fiscal position is at risk,” one analyst noted. “The naira’s depreciation reflects the market’s reaction to reduced dollar inflows from oil sales.”

This renewed volatility comes amid ongoing efforts by the CBN to stabilize the currency through policy tightening and foreign exchange reforms. However, the external shock from oil markets may blunt the impact of these measures, adding pressure on policymakers to explore alternative revenue streams and accelerate economic diversification.

As the situation unfolds, investors and economic stakeholders will be closely monitoring the response from both the CBN and the Federal Government.