Nigeria’s Eurobonds yields fall to 6.95%, lowest in four years on rising oil prices

The Nigerian Sovereign Eurobond market saw a lot of buy orders, leading the average yields to drop to 6.95 percent last week, the lowest in four years, driven by rising oil prices and potential U.S. attacks on Iran.

“The Nigerian Sovereign Eurobond market traded largely bullish, supported by improved global risk sentiment, rising crude oil prices, and sustained demand for higher-yielding emerging market assets. The average benchmark yield declined by six basis points week-on-week to 6.95 percent,” analysts at CSL said.

They also mentioned that a mix of favourable domestic and global macroeconomic factors supports the rising demand for emerging markets, including Nigeria’s Eurobonds.

Lower domestic inflation figure at 15.10 percent in January and rising global crude oil prices, driven in part by heightened tensions in the Middle East, contributed to improved investor sentiment.

For Nigeria, Africa’s top oil producer, the further rally in crude offers a welcome lift for foreign exchange (FX) inflows and fiscal revenues.

Similarly, analysts at AIICO said the rally was driven by mixed macroeconomic data, oil price volatility and potential U.S. attacks on Iran.

Tensions were high last week, and despite talks in Oman, both sides remain at an impasse. Donald Trump’s,  U.S. President pressure on the Iranian regime escalated after a brutal crackdown on anti-government protestors across the country last month.

Global benchmark Brent oil price was up $2.13,  to settle at $69.46 a barrel at the start of the week, but ended the week at $67.75.

Oil prices are therefore likely to stay volatile, with sharp two-way swings driven by diplomatic signals rather than pure demand-supply fundamentals.

Meanwhile, Citi said if disruptions to Russian supply keep Brent in a $65 to $70 per barrel range in the coming months, OPEC+ is likely to respond by increasing output from spare capacity.

The market kicked off the week on a positive note, on the back of improved oil prices as the average benchmark yield dropped by three basis points. By midweek, profit-taking on selected maturities led to a yield uptick as the investors reacted to the U.S. January unemployment rate, which came lower at 4.3 percent, compared to the December rate of 4.4 percent, signalling a cautious Federal Reserve Policy stance.

Towards the end of the week, average yield dropped as investors reacted to the mixed U.S. jobless claim data.

By the end of the week, the market stayed bullish as investors reacted to the U.S. CPI January data of 2.4 percent, lower than the estimate of 2.5 percent and 2.7 percent in December 2025.

Eniola Olatunji is an experienced journalist at BusinessDay, where she has specialized in reporting on personal and business finance since March 2022.

She focuses on creating engaging and precise news stories, with a keen emphasis on the fixed-income market, banking, personal finance, cost of living, and the Nigerian economy. Her work also encompasses extensive market research and economic trend analysis.

Eniola is passionate about empowering individuals to make informed financial decisions and is dedicated to shedding light on the intricate workings of the economy. She holds a Bachelor of Science degree in Pure & Applied Chemistry from the University of Lagos.

Eniola Olatunji was shortlisted for The Future Awards Africa Prize for Journalism..

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