The Financial Markets Dealers Association (FMDA) projects Nigeria's current account surplus to expand to $8.69 billion in the third quarter of 2026. This forecast, detailed in its September 2026 Monthly Market Report, follows a $7.54 billion surplus recorded in the second quarter of the year. The Q2 figure had already surpassed FMDA's earlier projection of $6.12 billion, indicating a stronger-than-anticipated performance.
The anticipated widening of the surplus is primarily attributed to persistently elevated crude oil prices and a reduction in import demand. Stronger oil prices, with Brent crude averaging $99.95 per barrel in September, have provided significant support for Nigeria's external position. Geopolitical tensions in the Middle East contributed to this 14.43 percent rise in oil prices during the month.
Nigeria's trade balance has shown consistent improvement, rising from $1.18 billion in Q4 2025 to $5.45 billion in Q1 2026, and further to $9.22 billion in Q2. Similarly, the current account balance increased from $1.40 billion in Q4 2025 to $4.98 billion in Q1 2026 before reaching $7.54 billion in Q2. Gross foreign reserves also climbed to $54.92 billion in September from $53.81 billion in August, reflecting the strengthening external position.
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This improved external position has coincided with an appreciation of the naira, which strengthened by 1.93 percent in September. FMDA attributes this primarily to enhanced foreign exchange fundamentals, including stronger inflows from oil receipts and sustained market confidence. The association noted that while the Dangote Petroleum Refinery IPO may have generated some investor interest, its direct impact on overall FX liquidity remains limited for now, with significant foreign currency conversion expected only after allotment.
The $8.69 billion Q3 current account surplus remains a projection, pending the release of official data. Analysts will monitor whether this strengthening trend continues, especially as the U.S. Energy Information Administration (EIA) forecasts Brent crude to moderate towards $90 per barrel in the second half of 2026 before declining further to $74 in 2027. This outlook comes as Nigeria's Monetary Policy Committee reduced the Monetary Policy Rate by 350 basis points to 23 percent in September, alongside projected declines in financial system liquidity inflows for October.
Key Takeaways
Nigeria's projected current account surplus of $8.69 billion for Q3 2026 underscores a significant strengthening of the nation's external position, driven by a confluence of factors. Elevated global crude oil prices, fueled by geopolitical tensions, have bolstered oil receipts, a critical component of Nigeria's foreign exchange earnings. Concurrently, lower import demand has contributed to a healthier trade balance, further supporting the current account. This improved macroeconomic environment has translated into tangible benefits, including a notable appreciation of the naira and a rise in gross foreign reserves, signaling enhanced market confidence and better foreign exchange fundamentals.
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However, the Financial Markets Dealers Association (FMDA) cautions that while the Dangote Petroleum Refinery IPO has generated investor interest, its direct impact on overall FX liquidity is yet to be fully realized, as substantial foreign currency conversion is anticipated only post-allotment. The sustainability of this positive trend will depend on future oil price movements, with some forecasts suggesting moderation, and the continued effectiveness of domestic economic policies, including the recent Monetary Policy Committee rate cut aimed at managing inflation and liquidity. This complex interplay of global commodity markets, domestic demand, and policy decisions will shape Nigeria's economic trajectory in the coming quarters.
