FG slashes oil benchmark from $57 to $30 per barrel in 2020 budget

The federal government has proposed a $30 per barrel benchmark as against the $57 per barrel benchmark on which the 2020 budget was passed, following the unstable price of oil in the wake of the coronavirus pandemic.

Minister of finance, Zainab Ahmed disclosed this on Wednesday March 25 after a meeting between the executive arm of government and the leadership of the National Assembly in Abuja.

The meeting which was centered on review of the 2020 budget and Medium Term Expenditure Framework, particularly against the background of the impact of the Coronavirus pandemic on the global economy, lasted for 4 hours.

Zainab stated that the slash in the oil benchmark which became necessary as the nation prepares for a worst-case scenario, will insulate the Nigerian economy against any form of unexpected crisis.

The Minister told the leadership of the National Assembly that budgeted revenues for the Nigeria Customs Service have been reduced from N1.5 trillion to N943 billion “due to anticipated reduction in trade volumes; and privatisation proceeds to be cut by 50 per cent, based on the adverse economic outlook on sales of the Independent Power Projects (IPPs) and other assets.”

She added;

“Federal Government has undertaken cuts to Revenue-related expenditures for the Nigerian National Petroleum Corporation (NNPC) for several projects included in the 2020 Appropriation Act passed by the National Assembly in December 2019.

“The Federal Government is working on Fiscal Stimulus Measures to provide fiscal relief for Taxpayers and key economic sectors; incentivise employers to retain and recruit staff during the economic downturn; stimulate investment in critical infrastructure; review non-essential tax waivers to optimize revenues, and complement monetary and trade interventions to respond to the crisis.”