2020 Budget: Senate pegs oil price benchmark at $28 per barrel

Nigerian Senate Chambers
Nigerian Senate Chamber used to illustrate the story.

The Senate on Tuesday put the benchmark price for crude oil in the 2020 budget at $28 per barrel.

The Senate also reduced the targeted daily oil production from 1.94 million as initially proposed to 1.8 million barrels per day.

The red chamber also passed the Medium Term Expenditure Framework (MTEF) and Fiscal Strategy Paper (FSP) projections, upon which the revised 2020 budget would be based.

These approvals were made after the chairman, Senate finance committee, Solomon Olamilekan (APC, Lagos), presented a report on the revised medium-term expenditure framework and fiscal strategy paper.

The federal government had in May cut down the 2020 budget, proposing a new one of about N10.3 trillion as against the N10.6 trillion initially passed by the National Assembly last year.

This was as a result of the gloomy global economic realities caused by the coronavirus pandemic as well as shrinking oil earnings caused by subsequent fall in oil prices.

“This is because, as we cut down the size of the budget,” finance minister Zainab Ahmed said, “we also have to bring in new expenditure previously not budgeted, to enable us adequately respond to the COVID-19 pandemic.”

As a recourse, Ms Ahmed said the federal government would be seeking loans to fund the 2020 budget.

Both the Senate and House of Representatives have approved the borrowing plan of N850 billion by the federal government from local fronts.

The House of Representatives also approved the $22.7 billion loan request of the President on Tuesday, three months after the Senate did the same.

Another loan request is before the two chambers for approval.

Ms Ahmed said the plan to borrow from foreign sources for 2020 “are all concessionary loans from the IMF which has already been approved and has crystallised, from the World Bank, Islamic Development as well as Afro EXZIM bank.”

“The borrowing, the multilateral loans drawdown coming from special accounts and coming from the privatisation will fund the fiscal deficit of N5.34 trillion that we have in the proposed amendment of the 2020 budget,” she added.


PT Mag Campaign AD

All rights reserved. This material and any other material on this platform may not be reproduced, published, broadcast, written or distributed in full or in part, without written permission from PREMIUM TIMES.

Support PREMIUM TIMES' journalism of integrity and credibility

Good journalism costs a lot of money. Yet only good journalism can ensure the possibility of a good society, an accountable democracy, and a transparent government.

For continued free access to the best investigative journalism in the country we ask you to consider making a modest support to this noble endeavour.

By contributing to PREMIUM TIMES, you are helping to sustain a journalism of relevance and ensuring it remains free and available to all.


TEXT AD: To advertise here . Call Willie +2347088095401...

BE THE FIRST TO KNOW! Subscribe to our newsletter

* indicates required


Now available on

  Premium Times Android mobile applicationPremium Times iOS mobile applicationPremium Times blackberry mobile applicationPremium Times windows mobile application