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WEEKLY LPG INSIDER REPORT


 
Prices have shown a slight rise in the international and domestic markets for LPG in the immediately preceding week
 

  • International(Mont Belvieu) prices of LPG maintained a generally rise throughout the week under review. This trend is related to the growing oversupply situation in the market as storage capacities approach their peak.

  • Prices of LPG at the depot level only rose slightly from what they were the previous week.

  • With a general drop in retail price compared to last week, what we see is a general drop in prices across the value chain in the domestic market

  • Despite the general drop in prices Regional disparities in the retail prices of LPG within the country continue to persist.
     

     

     

     
     

    Regional disparity in the prices of LPG across the country has been a regular feature of the Nigerian LPG market. Though the South-south geopolitical zone hosts the great majority of depots in the country due to its proximity to the ocean, prices have been highest in the region.
     

     

    • The exchange value of the naira to the US. $ was remained stable at N361 to US.$1 throughout the week (Figure D).

    • Like the previous week, the nation's foreign reserve is continuing to experience a drop.

    • For the gas market, though the Purchasing Managers Index(PMI) of the CBN report declining inventory, new orders and employment for the month of June 2020, the decline is lower for the month of June compared to the month of May.

    • The removal of the restriction on inter-state movement due to the COVID-19 led to an initial rise in prices for LPG at the depot level last week. That initial rise is now followed up by a fall in prices in the current week.

    • Prices of crude oil in the international market in the week under review showed a general upward trend, though a decline had commenced from mid-week(Figure E).

     

     

     

  • The easing off of the oversupply situation in the international market for Natural gas will likely lead to a rise in prices in the weeks to come.

  • the twin effect of a drop in foreign reserve and the recent devaluation could lead to a stabilization of the air at the new rate.

 


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