Exchange Rate Volatility and Performance of Selected Oil and Gas Firms in Nigeria

This study examined the relationship between exchange rate volatility and performance of selected oil and gas firms in Nigeria. However, the specific objectives were to examine the effect of exchange rate fluctuations on return on assets of selected oil and gas firms in Nigeria, to examine the relationship between inflation rate and return on assets of selected oil and gas firms in Nigeria, to ascertain the relationship between interest rate and return on assets of selected oil and gas firms in Nigeria and to assess the relationship between GDP growth rate and return on assets of selected oil and gas firms in Nigeria. The study adopted an ex-post facto research design and utilized a panel data of ninety (90) pooled observations gathered from nine (9) selected oil and gas firms in Nigeria over ten (10)-year period (2015-2024) and CBN Bulletin. This study employed a panel multiple regression technique to analyze the data via E-views 10.0 statistical package. The findings revealed that exchange rate has a non-significant negative relationship with return on assets of selected oil and gas firms in Nigeria while Inflation rate has a significant negative relationship with return on assets of selected oil and gas firms in Nigeria. It also revealed that Interest rate has a significant negative relationship with return on assets of selected oil and gas firms in Nigeria while GDP growth rate showed a significant positive relationship with between return on assets of selected oil and gas firms in Nigeria. It was thus concluded that exchange rate volatility has a significant influence on the performance of selected oil and gas firms in Nigeria. The recommendations made included that firms should develop strategies to manage the risks associated with interest rates, such as debt management and interest rate hedging, to minimize its negative impact on return on assets.