National Assembly Raises Oil Benchmark To $28 Per Barrel

The both Chambers of the National Assembly on Tuesday have raised the price of crude to $28 per barrel as against the $25 proposed by the executive.

This was sequel to the consideration of a report of the Committees on Finance on the 2020-2022 Medium Term Expenditure Framework and the Fiscal Strategy Paper at the floors of both Senate and Houses of Representatives.

It would be recalled that President Muhammadu Buhari, in separate letters to both chambers last Thursday, had said the revised N10.509trn 2020 budget was predicated on oil price benchmark of $25per barrel as against $57 per barrel fixed for the earlier one passed last December 2019.

The National Assembly noted that it increased the crude oil price because of the recent upward trend in the oil market which, it said, currently stood at $38 per barrel with a very strong expectation that the price would rise to $40 to $45 per barrel.

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The Nigeria Bi-camera Legislature, however, slashed the daily oil production output to 1.8 million barrels as against the 1.9 million proposed by the federal government.

This, according to the Lawmakers was the decision of cutting production by OPEC which Nigeria is a member. The N360/US $1 as proposed in the MTEF amendment was therefore sustained.

The sum of N500bn COVID-19 intervention fund and its utilization as proposed by the executive were also approved.

In the meantime, the House of Representatives has called for the immediate scrapping of the Excess Crude Account, saying it had no legal backing.

Speaking during the consideration of Report of Committee on Finance, the chairman of the committee Hon. James Abiodun Faleke ( APC Lagos ) said “that the House do consider the Report of the Committee on Finance on the Revised 2020–2022 Medium Term Expenditure Framework and Fiscal Strategy Paper and approve the recommendations therein” (Laid:2/6/2020).

“That the National Assembly should as a matter of urgency amend the fiscal responsibility Act in order to make it more responsive to present-day realities;

“That all Agencies of Government must submit their revenue performance to the National Assembly on a monthly basis;

“That the Excess Crude Account has no backing of the law. The Committee, therefore, recommends that the account be scrapped with immediate effect and comply with sections 80 and 81 of the 1999 Constitution of the Federal Republic of Nigeria (as amended);

“That the Crude Oil benchmark is recommended to be increased by US$3 thereby increasing from US$25 to US$28 per barrel; and

“That the Oil Production output should be retained at 1.9 Million Naira Per Barrel”.

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