According to a circular dated February 14, 2024, issued by the Director of the Trade and Exchange Department, Hassan Mahmud, oil companies can now only repatriate 50% of their proceeds immediately, with the remaining 50% available for repatriation after a 90-day period.

The CBN cited concerns over the practice of “cash pooling,” where proceeds from crude oil exports are swiftly transferred offshore to fund parent company accounts, impacting liquidity in the domestic foreign exchange market.

“This has an impact on liquidity in the domestic foreign exchange market,” the apex bank stated.

“In line with the ongoing reforms in the foreign exchange market, it has become necessary to take measures to address this trend. Consequently, the CBN hereby directs as follows;

“Banks are allowed to pool cash on behalf of IOCs, subject to a maximum of 50% of the repatriated export proceeds in the first instance;

“The Balance 50% may be repatriated after 90 days from the date of inflow of export proceeds.”