The country’s foreign reserves fell by $269.47m in five weeks, the latest figures obtained from the Central Bank of Nigeria revealed on Monday.
The reserves, which stood at $35.656bn as of November 4, fell to $34.925bn on December 12.
According to the figures, the reserves, which had continued to fluctuate, ended the month of October at $35.68bn.
Recently, the CBN Governor, Godwin Emefiele, said the restriction on global travel by land and air, along with the slowdown in commercial activities, led to a significant reduction in the demand for crude oil, which contributed to a 65 per cent decline in crude oil prices between January and May 2020.
“The drop in crude prices, along with OPEC reduction of Nigeria’s production quota, led to a significant decline in our foreign exchange earnings, along with a more than 60 per cent decline in revenues due to the federation account,” he said.
Like other emerging market countries and countries reliant on oil exports, he said, the decline in crude oil earnings, as well as the retreat by foreign portfolio investors, significantly affected the supply of foreign exchange into Nigeria.
He said in order to adjust for the decrease in the supply of foreign exchange, the naira was devalued from N305/$ to N360/$ and subsequently to N380/$.