Legit.ng’s Pascal Oparada has reported on tech, energy, stocks, investment and the economy for over a decade.

The naira’s depreciation against the US dollar in the Nigerian Foreign Exchange Market (NFEM) has led to the convergence of official and parallel market rates.

Data from the Central Bank of Nigeria (CBN) shows that on Thursday, July 17, 2025, the gap between the official and black market windows settled at less than N2.

The development comes as the naira closed trading on Thursday, July 17, 2025, at N1,533.11 per dollar in the official market, with an intraday high reaching N1,538 and an intraday low at N1,520 before closing at N1,536 per dollar.

The official foreign exchange rate depreciated for two consecutive trading days, with CBN’s update showing foreign reserves rising to $37.77 billion as of Wednesday, July 16, 2025.

Analysts believe that the absence of CBN’s intervention for most of July led to the naira’s falling value.

Market Forces Africa reported that gross external reserves began a fresh rise without OMO operations, showing that accretion is due to other foreign inflow sources.

In the parallel segment of the FX market, the exchange rate appreciated to N1,535 per dollar on Thursday, July 17, 2025, reducing the gap between the two windows to less than N2.

Analysts are optimistic that the naira will rebound due to a combination of factors such as rising reserves and an increase in Nigeria’s oil production, an essential FX spinner for the country.

A prior report by Legit.ng disclosed that Nigeria’s daily crude oil production increased above the quota allocated to it by the Organisation of the Petroleum Exporting Countries (OPEC) in June 2025.

This is the second time in 2025 that the country would exceed its OPEC quota of 1.5 million barrels daily.

The first time was in January, and the second was in June 2025.

The Nigerian Upstream Petroleum Regulatory Commission (NMDPRA) disclosed that Nigeria’s daily average crude production was about 1,505,474 barrels per day, representing 100.4% of the OPEC quota.

According to reports, in May 2025, crude production stood at 1.45 million barrels per day, while crude and condensate production were 1.65 million barrels per day, and production dropped to 1.60 in March.

The upstream regulator disclosed in its report that the lowest and peak crude oil and condensate production in June totalled 1.61 million barrels per day and 1.82 million barrels per day, respectively.

Industry experts have said the development is a massive boost for both the country’s external reserves and the local currency.

“Crude oil is Nigeria’s major FX earner and a major contributor to external reserves. So, the increase will reflect positively on the reserves, which will also affect the naira,” Adeola Yusuf, energy policy expert and Team Lead at Platforms Africa, said.

He stated that the external reserves, which have risen recently, are a major buffer against the naira depreciation.

“Every time the CBN intervenes in the FX market by forex sales, it is usually from the reserves. So, it is critical that the reserves remain robust and the only way to remain strong is through earnings from crude oil sales,” he said.

Legit.ng earlier reported that the naira may slide to N1,700 per US dollar by the end of 2025, according to a new H2 economic outlook by Cordros Securities.

This would represent a 9.5% drop from current rates and highlights Nigeria's ongoing currency vulnerability, despite efforts by the Central Bank of Nigeria (CBN) to stabilise the market.

The Cordros report, however, acknowledges that recent FX reforms and stronger reserve buffers have mitigated more severe devaluation.

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Source: Legit.ng