• Latest
  • Trending
  • All
  • News
  • Lifestyle
The world’s biggest oil hedge program underway thumbnail

The world’s biggest oil hedge program underway

July 27, 2020
A Vermont dairy farm was raided. The mixed messages from Washington since then have increased fears. thumbnail

A Vermont dairy farm was raided. The mixed messages from Washington since then have increased fears.

July 8, 2025
Former Rams Assistant Gives Inside Look at Houston Texans Offense thumbnail

Former Rams Assistant Gives Inside Look at Houston Texans Offense

July 7, 2025
‘Alligator Alcatraz’ Detention Center Poses Serious Risks to Immigrants Beyond Just Alligators thumbnail

‘Alligator Alcatraz’ Detention Center Poses Serious Risks to Immigrants Beyond Just Alligators

July 7, 2025
Oral Frostbite Injury Highlights Dangers of Recreational Nitrous Oxide Use thumbnail

Oral Frostbite Injury Highlights Dangers of Recreational Nitrous Oxide Use

July 7, 2025
No one cares about Netflix original movies, and here’s the proof thumbnail

No one cares about Netflix original movies, and here’s the proof

July 6, 2025
Boston-based effort reminds Black people of rights when confronted by law enforcement thumbnail

Boston-based effort reminds Black people of rights when confronted by law enforcement

July 6, 2025
The lie Republicans will use to sell punishing megabill cuts to MAGA voters thumbnail

The lie Republicans will use to sell punishing megabill cuts to MAGA voters

July 4, 2025
What we know so far about Idaho ambush suspect Wess Roley thumbnail

What we know so far about Idaho ambush suspect Wess Roley

July 2, 2025
Musk proposes a new political party; Trump suggests DOGE ‘might have to go back and eat Elon’ thumbnail

Musk proposes a new political party; Trump suggests DOGE ‘might have to go back and eat Elon’

July 2, 2025
Trump news at a glance: president pushes Republicans to back big bill amid forecast losses to healthcare thumbnail

Trump news at a glance: president pushes Republicans to back big bill amid forecast losses to healthcare

July 1, 2025
GNCC Racing’s Josh Toth Races Southwick National 450 Motos, Drives 12 Hours then Wins Little Raccoon National Enduro thumbnail

GNCC Racing’s Josh Toth Races Southwick National 450 Motos, Drives 12 Hours then Wins Little Raccoon National Enduro

July 1, 2025
Senate barely approves procedural vote to open debate on spending bill thumbnail

Senate barely approves procedural vote to open debate on spending bill

June 30, 2025
  • About
  • Advertise
  • Privacy & Policy
  • Contact
  • Donate
Tuesday, July 8, 2025
66 °f
Wellfleet
58 ° Tue
63 ° Wed
68 ° Thu
61 ° Fri
  • Login
  • Register
FREE Cape Cod News
DONATE
  • FREE Cape Cod News
  • Cape Cod News
  • News
    • News
    • Massachusetts
    • Breaking News
    • Cape Cod Weather
    • Storm Watch
    • Environment
  • Politics
    • democrats
    • republicans
  • Business
    • business
    • cryptocurrency
    • economy
    • money
    • Real Estate
    • Tech
  • World
  • Entertainment
  • Lifestyle
  • Photos
    • Orleans
    • Eastham
    • Wellfleet
    • Truro
    • Provincetown
    • Brewster
    • Chatham
  • Videos
No Result
View All Result
Free Cape Cod News
No Result
View All Result
  • FREE Cape Cod News
  • Cape Cod News
  • News
  • Politics
  • Business
  • World
  • Entertainment
  • Lifestyle
  • Photos
  • Videos
Home World

The world’s biggest oil hedge program underway

FREE Cape Cod News by FREE Cape Cod News
July 27, 2020
in World
Reading Time: 5 mins read
Donate
0
The world’s biggest oil hedge program underway thumbnail
635
SHARES
1.4k
VIEWS
Share on TwitterShare on Facebook

Commodities are basically raw materials. They play an important role in most aspects of the daily lives of Nigerians, serving as food (cashew, cocoa sugar cane), energy (natural gas, crude oil) and source of income for many global investors, as commodities can be an important way to diversify their portfolio beyond traditional securities.

Commodities play a vital role in Nigeria’s economy, accounting for more than 90% of its export.

UBA ADS

Data obtained from the Central Bank of Nigeria shows that the country has a commodity-driven economy, with a total land area coverage of about 910, 768 Km2 of which about 33% is arable land and about 3.14% suitable for growing permanent crop.

Prices of major commodities such as crude oil, gold, cocoa have been on the rise since President Muhammadu Buhari shut the nation’s land borders, whereas the Nigerian Stock Exchange’s year-to-date return was over -12% in the first quarter before moderating to the current –8.99%.

READ ALSO: NNPC diversifies into housing, power; plans to beat crude production cost to $10 per barrel

Adeagbo Adedayo, Country Manager, Scope Markets Ltd, spoke to Nairametrics about why it’s the time for Nigerians to consider investing in commodities derivatives such as crude oil futures. He said;

“Looking closer at Nigeria’s main export, crude oil,  every day we need energy to accomplish a lot of tasks from manufacturing down to the food we eat.

“Investing in such energy derivative that is involved in our daily activity is very lucrative.

“As we can see that a lot of events like US/Iran face-off and COVID-19 virus had an impact on the price of crude oil in the first two quarters of the year 2020.

“The oil price benchmark fell to its lowest ever in history as of March 8th, 2020, losing about 90% of its market value for the year 2020. This piece of information is very useful as an investor or to anyone who intends to trade crude oil.”

In a previous article, Nairametrics had advised investing in commodities as an asset class. However, because commodity derivatives are pretty new to many Nigerians, a lot of people do not know that they can manage portfolio volatility by allocating part of their funds to commodities as its value is inversely proportional to stocks and bonds.

app

Dapo-Thomas Opeoluwa, an independent oil trader, in a phone interview with Nairametrics, explained the advantages and simplicity commodity trading brings over other financial traded assets. He said;

“For a country that’s vested in oil, it’s quite surprising that very few people trade commodities. Most retail traders in Nigeria opt for currency pairs or cryptocurrencies that have harder fundamentals to follow.

“Which is easier to understand? British pound volatility because of Brexit, the Bitcoin Halving in May or oil price crashing to negative digits a few months ago? I think the latter gained more traction amongst Nigerians.”

devland

Also, it will help expand Nigeria’s long-neglected agricultural sector, support government diversification agenda, encourage local farmers and enhance job creation, especially in the rural regions.

READ ALSO: Will the recovery in the oil market be shortlived?

GTBank 728 x 90

Ecobank

Common ways to invest in Commodities in Nigeria

Using commodity futures; These are agreements to sell or buy a given amount of commodity at a particular price and specified date in the future. They can be traded online through a broker that connects to a commodity exchange. Examples are Crude oil futures, Soybean futures.

Using CFDs; A contract for difference (CFD) is a derivative asset, where there is an agreement (usually between a broker and a commodity trader) to pay the differential in the commodity price of an underlying asset between the beginning and end of that contract.

Using the Physical method; The most popular way of commodity investing in Nigeria would be purchasing the commodity itself. Commodities such as cocoa, gold can easily be traded physically,

However, commodities like natural gas, crude oil, are not suitable for many such means because of their flammable properties and the fact that it’s expensive to store, and in the case of electricity, impossible to store.

READ: Commodity market: How it works

Using Commodity based ETFs; Some Nigerians have investing in commodity-based exchange-traded funds (ETFs) via their broker who links them to the Nigerian stock exchange. An exchange-traded fund is a type of fund that is traded on a stock exchange.

Silas Ozoya, Managing Partner/CEO, SUBA Capital spoke to Nairametrics on the uniqueness commodity trading brings. He said;

app

“Inthe last few years, especially very recently, the commodity market has shown itself to be more stable than any other market.

“The market has faced rising inflation, a recession, naira devaluation, tightened FOREX regulations and of course, the pandemic and in all, still standing strong.

“When placed side by side the capital market, the commodity market is less volatile. Meaning that it’s less risky.

“Trading or investing in commodity enhances your diversified investment portfolio and hedges whatever risk that may arise from your other asset classes.

READ ALSO: Okomu Oil and its multifarious related party transactions

“Our current experience with the pandemic has shown that companies in agricultural commodities for example still had a pass to carry on business, make money and profit while other businesses were negatively affected.”

Finally, commodity investing/trading should be encouraged in an emerging economy like Nigeria given its low margin, transparency, risk management, and benefits to economic parameters like farmers that have been neglected over the years. The uncertainties surrounding the stock market and other investments during a period of high inflation like this could be hedged by investing or diversifying into commodities.

Read More

FREE Digital Newspaper Subscription!
Sign up for your free digital subscription. The FREE Cape Cod News

Unsubscribe
FREE Cape Cod News

FREE Cape Cod News

Free Cape Cod News is what's happening in the Cape Cod, U.S and World & what people are talking about right now. Local newspaper. Stay in the know. Subscribe to get notified about our latest news.

Related Posts

Cheering support and instant condemnation: US lawmakers respond to attack on Iran thumbnail
News

Cheering support and instant condemnation: US lawmakers respond to attack on Iran

by FREE Cape Cod News
June 23, 2025
N. Ireland: Fears Trump tariffs could impact peace agreement thumbnail
World

N. Ireland: Fears Trump tariffs could impact peace agreement

by FREE Cape Cod News
April 25, 2025
Biden administration imposes sanctions on 2 Indian companies for violating US curbs on Russia: Report thumbnail
News

Biden administration imposes sanctions on 2 Indian companies for violating US curbs on Russia: Report

by FREE Cape Cod News
January 13, 2025
France’s proposed new sugar tax could transform the biggest food companies—will the consumer pay the price? thumbnail
News

France’s proposed new sugar tax could transform the biggest food companies—will the consumer pay the price?

by FREE Cape Cod News
December 2, 2024
Load More
Please login to join discussion

Follow Us on Twitter

FREE Cape Cod News - Your source for local Cape Cod news, latest breaking U.S. and World news. Every day, all day. Subscribe for your favorite categories.

  • Trending
  • Comments
  • Latest
Former Rams Assistant Gives Inside Look at Houston Texans Offense thumbnail

Former Rams Assistant Gives Inside Look at Houston Texans Offense

July 7, 2025
A Vermont dairy farm was raided. The mixed messages from Washington since then have increased fears. thumbnail

A Vermont dairy farm was raided. The mixed messages from Washington since then have increased fears.

July 8, 2025
The lie Republicans will use to sell punishing megabill cuts to MAGA voters thumbnail

The lie Republicans will use to sell punishing megabill cuts to MAGA voters

July 4, 2025
Former Rams Assistant Gives Inside Look at Houston Texans Offense thumbnail

Former Rams Assistant Gives Inside Look at Houston Texans Offense

0
A Vermont dairy farm was raided. The mixed messages from Washington since then have increased fears. thumbnail

A Vermont dairy farm was raided. The mixed messages from Washington since then have increased fears.

0
Oral Frostbite Injury Highlights Dangers of Recreational Nitrous Oxide Use thumbnail

Oral Frostbite Injury Highlights Dangers of Recreational Nitrous Oxide Use

0
A Vermont dairy farm was raided. The mixed messages from Washington since then have increased fears. thumbnail

A Vermont dairy farm was raided. The mixed messages from Washington since then have increased fears.

July 8, 2025
Former Rams Assistant Gives Inside Look at Houston Texans Offense thumbnail

Former Rams Assistant Gives Inside Look at Houston Texans Offense

July 7, 2025
‘Alligator Alcatraz’ Detention Center Poses Serious Risks to Immigrants Beyond Just Alligators thumbnail

‘Alligator Alcatraz’ Detention Center Poses Serious Risks to Immigrants Beyond Just Alligators

July 7, 2025

FREE Cape Cod News On Twitter

Today’s News

  • A Vermont dairy farm was raided. The mixed messages from Washington since then have increased fears. July 8, 2025
  • Former Rams Assistant Gives Inside Look at Houston Texans Offense July 7, 2025
  • ‘Alligator Alcatraz’ Detention Center Poses Serious Risks to Immigrants Beyond Just Alligators July 7, 2025
  • Oral Frostbite Injury Highlights Dangers of Recreational Nitrous Oxide Use July 7, 2025
  • No one cares about Netflix original movies, and here’s the proof July 6, 2025
FREE Cape Cod News

Copyright © 2024 Free Cape Cod News

Navigate Site

  • About
  • Advertise
  • Privacy & Policy
  • Contact
  • Donate

Follow Us

Welcome Back!

Login to your account below

Forgotten Password? Sign Up

Create New Account!

Fill the forms below to register

All fields are required. Log In

Retrieve your password

Please enter your username or email address to reset your password.

Log In

Add New Playlist

No Result
View All Result
  • FREE Cape Cod News
  • Cape Cod News
  • News
    • News
    • Massachusetts
    • Breaking News
    • Cape Cod Weather
    • Storm Watch
    • Environment
  • Politics
    • democrats
    • republicans
  • Business
    • business
    • cryptocurrency
    • economy
    • money
    • Real Estate
    • Tech
  • World
  • Entertainment
  • Lifestyle
  • Photos
    • Orleans
    • Eastham
    • Wellfleet
    • Truro
    • Provincetown
    • Brewster
    • Chatham
  • Videos
  • Login
  • Sign Up

Copyright © 2024 Free Cape Cod News