THE Federal Government has started close monitoring of the global oil market following the free fall in oil prices, including Nigeria’s Bonny Light, which price dropped from $12 to $5.30, Tuesday.
The 2020 budget was first benchmarked at $57 per barrel and 2.3 million per day, mb/d, but later adjusted to $30 and 1.42 mb/d because of prolonged instability in the volatile market, which made previous projections unattainable.
At the current $5.30 per barrel, Nigeria, which economy has been seriously affected by the coronavirus pandemic, needs an additional $24.7 to meet the 2020 budget target.
Investigation showed that it has become a serious source of concern to relevant government institutions, especially the Federal Ministry of Finance, Budget and National Planning.
However, Special Adviser to the Minister, Federal Ministry of Finance, Budget and National Planning, Mr. Yunusa Abdullahi, who confirmed the close monitoring of the ministry, ruled out another immediate budget review.
According to him, the ministry was still waiting for the response of the National Assembly to the earlier review announced by the Minister of Finance, Budget and National Planning, Mrs. Zainab Ahmed.
He said: “We are watching what is happening in the oil market. We were very optimistic that prices would pick up after the recent OPEC meeting after which a production cut was announced. Indeed, we saw a rise in the oil prices, but then we are seeing the prices going to the present level.
“We cannot review the budget on a daily basis as oil prices move. We are watching to see what will happen in the weeks ahead. We are looking ahead to the bigger picture. The minister had said that we would be watching to see what would happen in the market.
“In addition, we are awaiting the response of the National Assembly to the review, which was sent to the law makers. Their position is very important. While we await the National Assembly, we will watch the situation for now.”