Nigeria to Further Revise 2020 Budget Oil Benchmark to $20 Per Barrel

• The Nigeria Federal Government has said that it is planning to revise the 2020 budget oil benchmark to $20 per barrel.
• This was revealed by Zainab Ahmed, Minister of Finance, Budget and National Planning, at a webinar on Citizens Dialog on Government Fiscal Policy Decisions.
• The low crude oil prices and low demand have affected the Nigerian economy hard, and as such its income and foreign exchange earnings have been heavily impacted.

The Nigeria Federal Government has said that it is planning to revise the 2020 budget oil benchmark to $20 per barrel.

This was revealed by Zainab Ahmed, Minister of Finance, Budget and National Planning, at a webinar on Citizens Dialog on Government Fiscal Policy Decisions, which was in response to the drop in oil prices and the Covid-19 pandemic. The web conference focussed on the impact on Nigeria’s economy of low oil prices.

Whilst speaking, the Finance Minister stated, ‘’We are in the process of an amendment that is bringing down the revenue indicator to $20 per barrel’’.

Ahmed also pointed out that the country’s numerous ongoing oil and gas ventures would be completed much later than originally expected as a result of upstream budget cuts caused by the global oil crisis.

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It can be noted that the Federal Government revised the 2020 budget target from $57 to a barrel to $30 to a barrel some weeks ago. The production level has also been updated from around 2.1 million barrels per day to 1.7 million barrels per day.

This was attributed to the worldwide unprecedented collapse in crude oil prices triggered by the coronavirus pandemic as well.

The low crude oil prices and low demand have affected the Nigerian economy hard, and as such its income and foreign exchange earnings have been heavily impacted.

Last month the Nigeria federal government cut down the 2020 budget by over N320 billion and proposed a new budget of N10.27 trillion. This was due to the global economic challenges as a result of the result coronavirus pandemic as well as the recent crisis in the oil market.

Reports at the time showed that the budget cut by the Nigeria Federal government reduced the oil benchmark form $57 per barrel to $30 per barrel while the oil production volume was reduced from 2.18 million barrels to 1.70 million barrels