The Federal Government will review the 2020 budget to reflect an oil benchmark of $20 per barrel.
Minister of Finance, Budget and National Planning Minister, Zainab Ahmed, said this on Tuesday, during a web conference about the impact of low oil prices on Nigeria’s economy.
“We are in the process of an amendment that is bringing down the revenue indicator to $20 per barrel”, Ahmed said.
A further downward revision will mean that the Federal Government has now dropped the benchmark from an initial $57 per barrel to $30.
Speaking to Reuters on Wednesday, Ahmed also disclosed the Federal Government plans to cut oil production to 1.7 million barrels per day (mbpd), from the 2.1 mbpd previously proposed in the budget.
Other key highlights from the conference include;
1.Plans to defer debt service obligations to 2021 and beyond until macro conditions improve; An 80% drop in estimated net oil & gas revenue available for Federation Account Allocation Committee (FAAC) distribution to N1.1 trillion against the N5.5 trillion previously earmarked; A marginal drop in Customs projected revenue to N1.2 trillion in 2020 from the previous N1.5 trillion, while the amount accruable to the federation account is now projected at N3.9 trillion from the initial N8.6 trillion.
The finance minister added that the government is also looking at provide support for the aviation sector as part of measures to alleviate the impact of COVID-19.