The Digest:
First HoldCo Chairman Femi Otedola has expressed optimism that the naira will strengthen to below N1,000 per US dollar before the end of 2026, citing the Dangote Refinery's attainment of full 650,000 barrels per day capacity. In a social media post, Otedola congratulated Aliko Dangote on the milestone, stating that domestic refining ending decades of import dependence will significantly ease pressure on the foreign exchange market. He noted the refinery now supplies up to 75 million litres of PMS daily, conserving foreign exchange. Otedola also revealed Dangote has commenced a $12 billion expansion to increase refining capacity to 1.4 million bpd. The naira traded at N1,400.47 to the dollar at the official market on January 29.
Key Points:
- A stronger naira would reduce import costs for goods and services, easing inflation pressures on households.
- Sustained sub-N1,000 exchange rate would lower production costs for businesses reliant on imported inputs.
- Nigerian consumers and manufacturers stand to benefit, while the economy gains improved purchasing power.
- This signals growing confidence that local refining can deliver structural FX relief rather than temporary gains.
- The timing, following full capacity declaration, aligns with early signs of FX market stabilisation.
Otedola's forecast will be tested by sustained refining output, FX liquidity improvements, and global oil price dynamics in coming months.
Sources: The Cable, Dangote Refinery, Femi Otedola/Social Media
