Law News
Senate fixes $52 oil benchmark for 2015 budget

The Senate on Tuesday at an executive session, settled for $52 per barrel as oil price benchmark for the N4.3tn  for the implementation of the 2015 budget.

This is against the $65 per barrel, which was finally settled for by the executive  in December last year.

A senator, who spoke on conditions of anonymity,  confided the development in a chat with our correspondent on Tuesday.

President Jonathan had through three different Medium Term Expenditure Framework and Strategy Paper documents, forwarded to the National Assembly before submitting the entire 2015 budget profile  through the Minister of Finance, Okonjo Iweala, proposed $77, $73 and later $65.

Okonjo – Iweala, had presented a national budget size of N4.357tn  based on a projected oil revenue of oil revenue of 2.2m barrel per day.

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

The Chairman, Senate Committee on Finance, Senator Ahmed Makarfi and his counterpart in the Rules and Business, Senator Ita Enang,  had told our correspondent in separate interviews that  the National Assembly, did not need the executive to dictate a benchmark to prosecute the 2015 budget.

Enang had said, “We do not need a revised MTEF/FSP from the executive because on the crash in the oil price,  in the international market. It is our responsibility to look at the budget vis-a vis the current market forces and determine an appropriate benchmark.

“In my own opinion,  I believe that the benchmark should be fixed at $40 per barrel in line with the prevailing oil sales in the international market”

Makarfi also said, “It is now the responsibility of the National Assembly to decide whether we will approve the oil benchmark as submitted by the executive or fix a new one. We do not need to wait for another benchmark from the executive before we start work on the budget.”

Other senators, who also spoke with our correspondent on conditions of anonymity on Tuesday, confirmed that the benchmark had been reviewed  to reflect the economic reality on the ground,  arising from the fall in the crude oil prices in the international market.

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