Nigeria’s dollar-denominated bonds headed for their worst week on record, with yields rising to the highest since April, after oil, the nation’s biggest foreign- currency earner, fell for the third week. The price on the 6.75 percent Eurobonds due 2021 of Africa’s biggest oil producer declined for a seventh day, losing less than 0.1 percent to 103.063 cents on the dollar, as of 11:37 a.m. in London. The notes were poised for a weekly slump of 3.3 percent, the biggest five-day decline since their January issue. The yield rose to 6.314 percent, the highest since April 28, according to data compiled by Bloomberg. The $500 million of bonds are Nigeria’s only international notes. Crude oil headed for the third weekly decline on concern that volatility in financial markets will worsen an economic slowdown. Nigeria relies on crude exports for 95 percent of its foreign-currency earnings. “The fiscal story in Nigeria could have weighted negatively in the past few months because as global financial and economic conditions deteriorate the market may be starting to price a relative downturn in oil prices,” Samir Gadio, a London-based emerging-markets strategist at Standard Bank Group Ltd., said in a phone interview today. “It doesn’t mean Nigeria is going to default obviously; it has large reserves.” The nation’s foreign-currency reserves fell 5.7 percent to $35 billion as of Aug. 10 from a year ago, according to Central Bank of Nigeria data. “Considering the recent declines in the oil price we tend to have a less optimistic view about the economic growth going forward,” BNP Paribas SA analysts led by London-based Paul Mortimer-Lee wrote in a research note today. Africa’s most populous nation is rated B+ by Standard & Poor’s, the fourth-highest junk assessment, and BB- with a “negative” outlook by Fitch Ratings, the third-highest non- investment-grade level. Nigeria’s dependence on oil weighs against its rating outlook, Christian Esters, a Frankfurt-based credit analyst at S&P, said in a phone interview yesterday. To contact the reporter on this story: Chris Kay in London at ckay5@bloomberg.net To contact the editor responsible for this story: Gavin Serkin at gserkin@bloomberg.net

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