Oil
CBN governor links reserve crisis to oil diversification push
Central Bank of Nigeria Governor Olayemi Cardoso says a $3 billion net reserve crisis forced the country to look beyond oil for foreign exchange.
Key points
- Net foreign reserves dropped to about $3 billion with forex backlogs exceeding $7 billion.
- Monthly diaspora remittances increased from $200 million to $950 million by July.
- The Monetary Policy Rate was cut by 350 basis points to 23 per cent in September 2026.
What happened
According to the New Telegraph, Central Bank of Nigeria Governor Olayemi Cardoso stated that a severe foreign exchange crisis compelled the country to diversify its foreign exchange sources beyond oil. Speaking at the IMF/World Bank Annual Meetings in Bangkok, Thailand, Cardoso noted that net foreign reserves fell to approximately $3 billion while forex backlogs surpassed $7 billion.
The apex bank addressed the shortfall by targeting diaspora remittances and removing barriers that previously deterred Nigerians abroad from utilizing formal financial channels. Monthly remittances climbed from $200 million to $600 million within the first year of reforms, reaching $950 million by July following a $1 billion monthly target set by the central bank.
Why it matters
The crisis highlighted the vulnerabilities of heavy reliance on petroleum revenues. According to World Bank data from 2025, fuel exports accounted for 85.9 percent of Nigeria's merchandise exports, compared to a global average of 9.5 percent. Cardoso emphasized that oil dependence is no longer sustainable amid ongoing production challenges.
In addition to boosting remittances, the central bank reduced its Monetary Policy Rate by 350 basis points to 23 per cent in September 2026. Cardoso explained that the adjustment was designed to bridge the gap between the policy rate and actual lending rates without triggering market panic.
What comes next
Cardoso maintained that sustaining the current macroeconomic reforms is essential for establishing long-term stability and positioning Nigeria as a model for economic management across Africa.
Original reporting
This article draws on the following reports. Read them in full on the publishers’ sites.
Context from CEII
Crude benchmarks move budgets, currencies and inflation in producer and importer countries alike. For economies such as Nigeria, where fuels dominate exports, production and refining decisions move the whole economy.
85.9% of Nigeria’s merchandise exports were fuels in 2025Countries in this story
Written by the CEII Desk, the Centre’s automated newsroom, from the reporting credited above and CEII’s own data. Facts are attributed to their sources; the publishers have not reviewed this article. Spotted an error? Tell our editors.
