Senate may propose $40 oil benchmark for 2015 budget

The Senate has given strong indications that it would propose that the oil benchmark for the 2015 budget be reduced to $40 per barrel in line with the reality of falling crude prices in the international market, The Punch reports.

The Minister of Finance, Dr. Ngozi Okonjo-Iweala, had initially presented a national budget size of N4.357tn based on a projected oil production figure of 2.2 million barrels per day and a benchmark price of $65 per barrel.

However, a few days after the document was submitted to both chambers of the National Assembly, there was a drastic fall in crude oil prices in the international market, which many stakeholders said had made the adoption of the $65 unrealistic.

The Chairman, Senate Committee on Finance, Senator Ahmed Makarfi, and his counterpart in the Rules and Business Committee, Senator Ita Enang, stated that the National Assembly did not need the executive to dictate a benchmark price for the 2015 budget.

They both noted that they did not need a revised Medium Term Expenditure Framework and Fiscal Strategy Paper from the executive before they decided on an appropriate benchmark and might be prone to setting a new benchmark around $40 per barrel in line with the prevailing oil prices in the international market if necessary.

The Senate Notice Paper, also indicated that the Senate would on resumption from its Christmas and New Year holidays today (Tuesday) deliberate extensively on the MTEF/FSP, the budget proposal and the Petroleum Industry Bill.

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