FG Announces Plan To Review Budget As Oil Price Plunges Over Coronavirus

The Federal Government has announced plans to review the 2020 budget as crude oil revenue comes under pressure from the effects of the raging coronavirus infection globally.

The Minister of Finance/Budget Planning, Mrs Zainab Ahmed, said that the government was worried about the drop in oil revenue and would soon start a mid-term review of the budget to determine the way forward.

“We are concerned about the current drop in oil price because it’s now below our budget.

“We will do a mid-term review, and if the impact is so much, we will need to do an adjustment in the budget, working together with the National Assembly,” Ahmed told State House correspondents after Wednesday’s Federal Executive Council meeting in Abuja.

The session was presided over by the President Muhammadu Buhari , at the Presidential Villa.

The price of Nigeria’s Brent crude was well above $60 per barrel when Buhari signed the N10.59tn budget into law in December last year.

The budget has an oil benchmark of $57 per barrel.

However, the price has been on a free fall since January, worsening lately with the outbreak of coronavirus.

Ahmed noted that a rise in daily oil production above the budgeted two million barrels could draw in some money to cover the loss.

She added, “I am glad to inform you that our oil production as of today is two million barrels per day and at times slightly higher like 2.1 million. That in its self will be a cushioning effect for us in the current oil price.”

The minister also spoke on the FEC’s approval of the revised sum of $2.5bn for the Ajaokuta-Kaduna-Kano gas pipeline project. The original proposal for the project in 2017 was $2.89bn.

She stated that the project had multiple advantages, including job creation and increase in revenue to government.