Following the impact of low oil prices, the federal government is revising its 2020 budget to assume an oil price benchmark of $20 a barrel.
Finance Minister, Zainab Ahmed who disclosed this on Tuesday, said the federal government is in the process of an amendment that will bring down the revenue indicator to $20 per barrel.
This will be the second time such decision would be taken as a result of falling oil prices.
It would be recalled that after a meeting between the executive arm and the leadership of the House of Representatives in March, Zainab had announced government’s proposal to reduce the oil benchmark for the 2020 budget from $57 per barrel to $30.
She said it was part of the measures taken to prepare for the worst-case scenario and also to safeguard the economy from any form of emergency crisis in light of the crash in crude oil price at the international market.
Nigeria’s economy, which recovered from recession in 2017, was already grappling with slow growth of about 2 per cent before the oil crash.
Africa’s largest economy relies on petrodollar for about 90 per cent of its foreign exchange earnings and nearly 65 per cent of total government revenue.
The Finance Minister also stated at the Tuesday web conference that Nigerian oil and gas projects would be “delivered much later than originally planned” because of upstream budget cuts.