Russia’s invasion of Ukraine has led to a sharp rise in global oil prices amounting to more than 100 dollars per barrel. This development, without doubt, has posed high implications for the Nigerian economy as the largest oil-producing country in Africa. By extension, Africa will also feel the impact as its largest economy is affected.
Russia happened to be among the first three largest oil-producing countries in the world and the 11th largest economy globally, and by that, its impact is felt in the global market as one of the major actors that determine the global economy.
Its continuous onslaught on Ukraine has moved her contemporaries like the United States, the United Kingdom, etc. to place strict economic sanctions on the country and her citizen’s investments outside the shores of Russia.
Oil And Gas Is Best Performing Index In HY 2022 With 58% Gain
However, the Nigerian stock market is gaining from the rise in crude oil prices, especially the oil and gas stocks listed in the Exchange which came tops among the indexes that measure different sectors on the Exchange.
State of oil and gas index in HY’2022
The Oil and Gas Index emerged as the best performing index with a gain of 58% during the half-year ended June 30, 2022.
The Nigerian All Share Index closed the first half of 2022 with a gain of about 21.17% year to date (YTD) making it one of the best-performing stock markets in the world.
The equity trading recorded a gain of N5.639 trillion during the half-year ended June 30, 2022, as investors continue to increase their buying pressure, especially on blue-chip stocks.
Positive sentiments had returned to the local bourse as the release of full-year 2021 and Q1’22 corporate earnings bolstered buying interests in dividend-paying stocks.
According to data from the Nigerian Exchange Limited, the oil and gas index which measures the performance of the oil and gas firms quoted on the NGX grew by 58% or 200.33 basis points to close at 545.34 index point as against the opening index of 345.01 index points at the beginning of the year 2022 trading in January 4, 2022.
The NGX oil and gas index comprises nine listed oil marketing and production companies – Ardova Plc, Conoil, Eterna, Japaul Gold and Venture, MRS Oil Nigeria, Oando, Seplat Energy, Total Nigeria and Capital Oil.
NGX MERI growth index followed with a growth of 31.02% or 559.92 basis points to close at 2,364.94 index point from the opening figure of 1,085.02 in January.
Financial analysts believed that the growth in the segment was spurred by gains in the share prices of Seplat Energy, Eterna, Conoil and Oando.