Introduction
In May, 2016 the Nigerian government announced the deregulation
of the oil and gas sector which involved the removal of fuel
subsidy1 and the freedom of oil importers to source for
foreign exchange (FX) from the secondary sources
to facilitate their international trade.
Laudable as this deregulation policy may seem, the decline in
world crude oil prices and Nigeria's depleting foreign reserves
means that the positive impact has not been readily felt by
Nigerians, particularly importers, due to their inability to access
the FX needed to open Letters of Credit (LCs) for importation of
petroleum products.
In a bid to mitigate the challenges posed by the FX crisis, the
Central Bank of Nigeria (CBN) has attempted
several intervention mechanisms, and the jury is still out on the
determination of the effectiveness of these mechanisms and their
potential to resolve the FX scarcity. An example of such
intervention mechanism is the creation of a priority list
