Nigeria Lifts FX Restrictions, Allows Oil Firms Full Access to Export Proceeds

Nigeria’s central bank has scrapped a rule that required international oil companies to temporarily retain part of their export earnings, allowing them to repatriate all proceeds in a move aimed at boosting liquidity and restoring confidence in the foreign exchange market.

The change reverses a restriction introduced in February 2024 during acute dollar shortages, when the naira fell to record lows. At the time, the central bank capped immediate transfers of export proceeds at 50%, holding the remainder locally for 90 days to support liquidity.

In a circular dated March 25, the central bank said it had removed the “cash pooling” requirement, which previously allowed only a portion of oil export proceeds to be transferred immediately, with the remainder held for up to 90 days.

Under the new directive, oil companies can now repatriate 100% of their export earnings through authorised banks, subject to documentation and monthly reporting, with immediate effect.

The decision signals further liberalisation of Nigeria’s foreign exchange regime for oil exporters, a critical source of dollar inflows. However, analysts say it may not result in an immediate surge in supply.

The central bank said the move is part of broader efforts to “further liberalise and deepen the market in line with current realities,” as it seeks to stabilise the naira and attract investment.

For international oil companies, the reform restores greater control over cash flow, allowing firms to decide when and how to deploy export revenues without mandatory holding periods.

Industry executives say easier access to dollar earnings will improve treasury efficiency and slightly reduce financial risk in Nigeria’s upstream sector, where confidence in capital mobility remains crucial.